The Italian government is planning to raise the capital gains tax on cryptocurrencies to 28% instead of 42%. According to a Nov. 12 Bloomberg report, the government led by Prime Minister Giorgia Meloni is considering accepting a 2% increase instead of the initially reported 26%. Italian Economy and Finance Minister Giancarlo Giorgetti defended the proposed tax hike on Oct. 31.

It is unclear why the crypto tax plans were withdrawn. The prices of many cryptocurrencies have increased following the U.S. elections. In 2023, the Italian legislature raised the capital gains tax on crypto transactions over €2,000 to 26%. The 42% increase is expected to earn the government $18 million annually, while the 28% plan is expected to yield less.

The proposed tax increase will not come into effect until it is reviewed and approved by the Italian legislature. Giulio Centemero, a member of the Italian Chamber of Deputies, said in an X post on October 16 that taxing cryptocurrencies would be “counterproductive” and that the proposal should be discussed further.

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