After announcement by Portugal Finance Minister Fernando Medina that capital gains tax will be imposed on Crypto transactions, there were apprehensions among crypto investor community that Portugal will not remain a tax haven.
However, to much of their relief, the Portugal parliament i.e. Assembleia da Republica has rejected two bills which were introduced in the parliament to impose capital gains tax on crypto transactions, as per a news report. This has really come as good news for the crypto community because for the last few days there is a deluge of bad news being reported with regard to crypto field such as collapse of Terra USD and demands of regulation on crypto transactions.
Since 2018, Portugal provides tax free transactions for crypto investors who have flocked to Portugal in droves for enjoying tax exemptions. In contrast many countries like USA consider crypto currencies as property.
In India, recently a law was passed to make capital gains from trade in crypto currencies or digital assets subject to a huge 30% tax which has reduced the crypto trading activities in India by nearly 70%. Many crypto startups have shifted their base from India to other crypto friendly countries like Dubai.
The rejection of bills intending to impose capital gains tax on crypto transactions has lifted up the spirits of crypto enthusiasts in Portugal. Crypto transactions are not subject to any kind of tax in Portugal. However, a whopping 28% tax is applied on any other financial investments and even on those businesses which accepts Bitcoin as payment.
It may be noted that many leading economies such as USA, UK, France, India are planning to introduce strict regulations to regulate crypto transactions and to protect their citizens from crypto frauds. But on the other hand, there are some countries such as El Salvador, Central African Republic which are embracing cryptocurrencies particularly Bitcoin with open hands. In fact, Central African Republic is reported to taking measures to be a crypto hub.
