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Top 5 Crypto Tax-Free Countries

In 2017, the Japanese government became the first country to recognize Bitcoin (BTC) as a currency and to grant official licenses to exchanges, fostering the growth of what was already one of the biggest Bitcoin markets worldwide. There are more examples of countries with crypto-friendly regulations and tax policies, but not all pro-crypto countries have developed legal frameworks

Most countries charge the normal capital gains tax for cryptocurrency profits, such as the U.S. or the U.K. Leaving many people confused about what exactly to classify crypto as. This is where countries with crypto-friendly laws can be interesting. Although it’s safe to say that digital assets are still largely regulatory entities and the public, one can speculate that some of these entities in some countries are willing to provide a friendly foundation for digital assets to grow. 

Here are the top 5 Bitcoin tax-free countries

1. Germany

Germany does not consider Bitcoin (BTC) as a currency, commodity, or stock. Instead, Bitcoin is regarded as private money, similar to foreign currency. Also, trading in Bitcoins is considered under rule 23 EStG as a private sale, which provides tax-free benefits.

Specifically, this rule stipulates that trading in Bitcoins/cryptos is exempted from capital gains tax if their gains do not exceed 600 EUR per annum. However, for crypto businesses, the owners have to pay taxes on gains derived from Bitcoin through corporate income taxes.

2. Malta

Malta, a small island on the Mediterranean, is no surprise to this list. The country has established itself as a crypto paradise due to its crypto-friendly legislation. As in the case of long-held bonds, Malta doesn’t tax long-held cryptocurrencies.

Precisely, any EU citizen crypto investor who holds to his digital asset for more than 183 days is exempt from all taxes. The provision makes Malta a preferred destination for EU investors and Bitcoin holders.

3. Portugal

In Portugal, the gains on the value or sale of any currency are not subject to taxation. Since Portugal treats cryptocurrencies as a form of currency, it is automatically exempt from capital gains tax and VAT.

However, taxpayers who deal with cryptocurrencies as a business activity are still subject to taxes. Also, the exchange of crypto for fiat money is free of VAT, and crypto users don’t have to pay any income tax.

4. Belarus

Located in Eastern Europe, Belarus is a landlocked country that has been quite liberal to digital currencies. In December 2017, the president of Belarus signed a decree that legalized “smart contracts,” mining, and trading in cryptocurrencies.

Additionally, he declared that mining, trading, and capital gains on cryptocurrencies & ICOs would also be tax-free until January 1, 2023.

5. Slovenia

Located in Eastern Europe, Belarus is a landlocked country that has been quite liberal to digital currencies. In December 2017, the president of Belarus signed a decree that legalized “smart contracts,” mining, and trading in cryptocurrencies.

Additionally, he declared that mining, trading, and capital gains on cryptocurrencies & ICOs would also be tax-free until January 1, 2023.

Conslusion

Many countries are still grappling with the decision of whether to tax or not tax virtual currencies. But before they take a position, they have to figure out if cryptocurrency is an asset or a currency, like the USD or EUR.

When deciding where to locate your Bitcoin business, it is crucial to find out the government and the central bank’s approach to Bitcoin

Disclaimer: Fyggex, does not give any guidance, advice or recommendations to neither invest or not in any available cryptocurrency directly or indirectly via any trading platform, exchange or provider. Our sole purpose is to make you aware of the related real or potential risks and opportunities so that you can make your own research prior to any financial decisions you may want to take. Past performance and position are not a guarantee of risk-free future returns

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