Cryptoassets rated at 28% but there are exceptions. Intermediaries pay stamp duty – Cryptoactives

The Government will even move forward with the taxation of crypto assets in the IRS, according to the proposal for the State Budget for next year, delivered this Monday to the Assembly of the Republic. The Executive also clarifies that financial intermediaries of crypto transactions start to pay Stamp Duty.

In terms of IRS, unless the taxable person opts for aggregation, the Executive’s proposal applies the same rate as for other capital gains, 28%. “For capital gains relating to crypto assets held for a period of less than one year, a rate of 28% is applied (without prejudice to the option of aggregation)”, can be read in the OE2023 report.

However, similar to the German crypto taxation regime on individuals, the Government defines that “capital gains relating to crypto assets held for more than 365 days are exempt from taxation”. Still in terms of IRS, the Government proposes “the taxation of income from operations with crypto-assets such as business and professional income, or as an increase in equity (capital gains)”. This is the case with mining and other means of issuing crypto-assets.

The ministry headed by Fernando Medina also safeguards the possibility of these activities being framed in other categories of the IRS, “depending on the cases”.

Regarding stamp duty, where until then there was great uncertainty among intermediaries in the sector, the Government’s proposal states “expressly, the taxation of free transmissions of crypto-assets, as well as the incidence of Stamp Duty on the commissions charged in the intermediation of cryptocurrency transactions”.

These operations are therefore subject to a rate of 4%, “in line with most financial operations”.

For the Government, this regime provides “security and legal certainty by creating its own regime that aims to promote the crypto-economy”.

In this way, “it is intended to project the digital transition and exponentiate the 4.0 economy, as vectors of economic development and empowerment of the national labor market in terms of digital skills”, he adds.

On the other hand, in terms of investment, the Government proposes “more incentives for investment and regulation of crypto assets”.

German exception to crypto taxation “was an option” of AT study, reveals Mendonça Mendes

The State Budget proposal for 2023 provides that capital gains in terms of IRS, with regard to crypto transactions, are subject to a 28% release rate, unless the taxable person opts for aggregation. However, outside this regime are taxable persons who hold crypto assets for more than 365 days.

The Secretary of State for Tax Affairs, António Mendonça Mendes, revealed during the presentation of the proposal for the OE, that this exception – similar to what happens in the German regime “is an option taking into account the study” carried out by the Tax Studies. The content of the study to date has not been revealed.

“The option taking into account the study is the taxation of capital gains, when crypto-assets are held for less than one year”, said Mendonça Mendes.

Referring to the AT’s study of comparative law, the Secretary of State recalled that “it is the example of Germany” that opposes “Luxembourg and Belgium”. In the first case this period lasts six months, in the second it does not even exist.

As for the remaining rules proposed by the Executive, “the bet is to integrate this reality into what are the rules that already exist in the Portuguese tax system”.

“And that is why, in terms of assets, when a property is acquired through a crypto-asset, the valuation for the purposes of IMT is exactly the same valuation that is made under the terms of the IMT code”, exemplified Mendonça Mendes. “As well as the imposition of stamp duty on commissions as on free broadcasts,” she added.

“At the level of IRS and IRC, the only adaptation was to integrate the various categories, such as staking and mining, which are considered corporate income, and are therefore subject to the simplified or organized accounting regime”, continued the Secretary of State.

For Mendonça Mendes, “the ecosystem [cripto] is important for the country. Crypto assets are much more than cryptocurrencies. It is very important for the country to attract those who develop this technology with huge potential for the future,” he added.