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One of the Crypto tax-free countries, Portugal was called a crypto heaven country due to its absence of crypto-related taxation on any earnings reported on crypto transactions. Portugal is now planning to change this policy and working on establishing of law to impose a tax on digital assets.
During the state budget, the Minister of Finance, Fernando Medina, has made a statement: ” Several countries are building their models regarding this matter and we are going to build ours. I do not want to commit myself to a date at this moment, but we will adapt our legislation and our taxation.”
In action to this, the Ministry of Finance had asked the Portuguese Tax Authority to study crypto taxation of other regions over 2021. In order to adequate tax framework for these new instruments. This shows the government’s signs about the future direction of cryptocurrency in the country.
Along with the facts considered, the necessary balance between the fair distribution of income and wealth, is the attraction of foreign investment.
Yet to Decide on Models
Models on which the cryptocurrency earnings will be taxed are still unclear, as these models would be set up following the principles of justice and efficiency, aiming for a friendly tax system supporting out-of-country crypto investments.
Medina stated about making an adequate taxation system, instead of an exceptional character ending up with zero revenue.
Medina further continued saying that cryptocurrency must be taxed eventually, without the gaps that could cause there to be capital gains in relation to the transaction of assets that do not have a tax.
As a proof of development activity, the Crypto heaven country has reported for a bitcoin means of payment activity in the country recently on May 8. An apartment was sold for 3 BTC was the reported bitcoin payment activity of Portugal.