On December 29, 2022, Italy’s Senate approved a budget for 2023 that includes an increase in taxation for cryptocurrency investors.

The budget includes a 26% tax on capital gains from cryptocurrency trading over 2000 euros (about $2,13 at the time of publication).

Previously, cryptocurrencies were treated as foreign currencies in Italy and were taxed at a lower rate.

The budget also includes provisions allowing taxpayers to declare the value of their digital asset holdings as of January 1, 2022 and pay a 14% tax, in an effort to encourage people to declare their digital assets.

Other changes introduced by the budget include tax amnesties, incentives for job creation, a reduction in the retirement age, and $22.4 billion in tax breaks for businesses and households dealing with the energy crisis.

This legislation follows the approval of the Markets in Crypto Assets (MiCA) bill on October 10, which established a consistent regulatory framework for cryptocurrency in the European Union. MiCA is set to take effect in 2024.