Italy Doubles Down on Crypto: Bitcoin Capital Gains Tax to Surge to 42% in 2025

In a significant policy shift, Italy has announced plans to dramatically increase its capital gains tax on cryptocurrency investments from 26% to 42% as part of its 2025 budget initiatives. Deputy Economy Minister Maurizio Leo unveiled the measure during a press conference at Palazzo Chigi on October 16, citing the growing prevalence of cryptocurrency trading as a key factor in the decision.

The tax hike, representing a 62% increase from current rates, will affect capital gains from Bitcoin and other cryptocurrencies. Since 2023, Italian investors have been subject to a 26% tax on crypto gains exceeding €2,000 ($2,180), following the country’s shift from treating digital assets as foreign currency.

Alongside the cryptocurrency tax adjustment, the Italian government is also revamping its Digital Services Tax (DST) structure. The reform includes removing the current revenue thresholds – previously set at €750 million globally and €5.5 million within Italy – potentially expanding the tax’s reach to more digital service providers.

Prime Minister Giorgia Meloni’s government aims to generate approximately €3.5 billion from these measures, with funds earmarked for healthcare services and support for vulnerable citizens. “As we promised, there will be no new taxes for citizens,” Meloni stated on social media, indicating that the increased levies target specific sectors rather than the general population.

The tax increase comes as part of Italy’s broader €30 billion budget for 2025, which awaits parliamentary approval by year-end. Despite the significant tax hike announcement, Bitcoin’s market performance remained robust, with the cryptocurrency trading above $67,000 following the news.