Slovakia Cuts Down Crypto Tax Rate Dramatically to 7%

• From the present threshold rate of up to 25%, the taxes will drop dramatically to 7%.
• Up to 2,400 euros ($2,600) received in cryptocurrency will be exempt from taxation.

Lower crypto taxes and other measures impacting the crypto sector were approved by the National Council of the Slovak Republic, Slovakia’s parliament.

An amendment that would lower individual income tax on gains from the sale of cryptocurrency held by the holder for a minimum of twelve months was approved by a majority of the National Council on June 28.

Massive Boost for Sector

From the present threshold rate of either 19% or 25%, the taxes will drop dramatically to 7%. Moreover, up to 2,400 euros ($2,600) received in cryptocurrency will be exempt from taxation. In addition, the measure exempts cryptocurrency earnings from the 14% health insurance levy.

A local Slovakian news outlet said that the Ministry of Finance estimates an annual financial affect of roughly 30 million euros as a result of the modification. A similar amendment, protecting citizens’ right to use currency in the face of discussion of a digital euro, was enacted by parliament only weeks before this one.

The European Union, of which Slovakia is a part, has been keeping a close eye on the crypto industry’s growth in neighboring countries. The European Union (EU) officially enacted its historic Markets in Crypto-Assets (MiCA) laws on May 31. The goal of the new rules is to make Europe a center for trading digital assets.

Companies operating in this sector have lauded MiCA since its initial debut in 2020 for providing much-needed regulatory certainty. On the other hand, the United States, another key market, has yet to establish as extensive standards for the business as in other countries. Due to the regulatory crackdown by U.S. SEC, many crypto firms are looking for a safe haven outside of the U.S.

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