Albania Will Impose Crypto Tax From 2023. Albania, a country in southern Europe, is reportedly planning to begin taxing cryptocurrency earnings in 2023.
According to the local news platform Exit News, the taxation move is based on a new draught income tax law passed by the country’s legislatures. This draught law has helped to clarify some of the ambiguities in the country’s digital currency ecosystem, such as the definition of a “virtual asset” and “cryptocurrency mining.”
Albania Crypto Tax 2023
The new draft legislation defines virtual currency as “a digital representation of a value that can be deposited, traded, or transferred in digital form, and that can be used for payment or investment purposes, including but not limited to cryptocurrencies,” with the definition excluding Central Bank Digital Currencies (CBDCs).
Earlier this month, the Albanian parliament directed the Financial Supervisory Authority (AFSA) to prepare and implement new cryptocurrency regulations by the end of 2022. According to Exit News, Albanian law allows crypto trading platforms to operate legally in the country, but no licensed entities are currently operating.
Albania also passed a law titled “Financial markets based on distributed ledger technology” two years ago. While many have welcomed the legislation, critics have questioned whether the small southeast European country, which is still an EU candidate, is capable of properly regulating its crypto sector to prevent it from being used for money laundering, something it is struggling to do in the fiat space.
Individuals and businesses will be taxed based on their relative investment and income in the digital currency ecosystem, according to the new laws. While individual miners are expected to pay a 15% capital gains tax, more organized and corporate Bitcoin mining farms will be required to pay a business tax that is often tailored to the business profile.
Taxation has remained a critical topic in the developing cryptocurrency industry. Aside from Albania, countries such as India, Norway, and the United States of America are taking this issue very seriously. If the Albanian Financial Supervisory Authority (AFSA) and the parliament sign this crypto bill, it will go into effect in 2023.
While there has been some criticism of Albania’s approach to monetary policies in general, the country did not receive a high ranking from MONEYVAL, the European Union Committee of Experts on the Evaluation of Anti-Money Laundering Measures and the Financing of Terrorism. The regulator noted that Albania has not taken significant steps to combat money laundering, which could be exploited if the country becomes a haven for crypto-related money laundering.
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