New cryptocurrency tax in Portugal on the horizon?
Cryptocurrency tax in Portugal is looming, and it might occur sooner rather than later. Although the current tax regime on cryptocurrency is not transparent, many understand Portugal to be a tax haven for crypto assets taxation.
Since December last year, there has been some expectation that extending the personal income tax to cryptocurrencies will be discussed in the recently elected Assembly of the Republic (Portuguese parliament).
The recently elected Assembly of the Republic is controlled by the Portuguese Socialist Party (PS), a member of the European Progressive Alliance of Socialists and Democrats (S&D).
The above expectation on cryptocurrency taxation is also maintained by the fact that PS, although holding the majority, is still willing to make compromises with former parliamentary allies such as the Portuguese Communist Party and the Left Block (both members of The Left in the European Parliament – GUE/NGL), the latter advocated in its electoral program for the taxation of cryptocurrency capital gains under the current Portuguese Personal Income Tax Code.
On the other side of the Portuguese political spectrum, the second-largest party in the current formation of the Assembly of the Republic, the Social Democratic Party (a member of the European People’s Party), also advocated for the taxation of cryptocurrency capital gains under the same conditions proposed by the Left Block.
Usually, changes to Portuguese Tax Law are expected to take place with the approval, by the Assembly of the Republic, of the State Budget or shortly after it. So far, no date for it to be approved has been uttered since the new Government of the Republic, and the Members of the Assembly of the Republic are yet to take office.
Whether these changes to cryptocurrency taxation in Portugal this year and whether these will even be compatible with the Non-Habitual Resident scheme remains to be seen. For the moment, the stars seem to be aligned for it to happen.
This article is provided for general information purposes only and is not intended to be, nor should it be construed as, legal or professional advice of any kind.
Miguel Pinto-Correia holds a Master Degree in International Economics and European Studies from ISEG – Lisbon School of Economics & Management and a Bachelor Degree in Economics from Nova School of Business and Economics. He is a permanent member of the Order of the Economists (Ordem dos Economistas)… Read more