Spanish Parliamentary Group Proposes New Crypto Tax Bill Increasing Taxes on BTC, ETH

The Sumar Parliamentary Group in Spain has proposed three amendments to existing cryptocurrency tax legislation, potentially raising taxes on Bitcoin and other crypto assets. The amendments would change how gains from cryptocurrencies are taxed, placing them under the Personal Income Tax (IRPF) and Corporate Income Tax, while also suggesting new risk assessment measures.

Key Takeaways

The Spanish Sumar Parliamentary Group has introduced amendments that could increase taxes on Bitcoin (BTC) and Ethereum (ETH).
Proposed amendments suggest taxing crypto gains under the Personal Income Tax at a general rate up to 47% and a 30% Corporate Income Tax.
A risk assessment system, resembling a "traffic light" for crypto, is proposed to inform investors of potential risks.
Legal experts express concerns over the feasibility and implications of these proposals, highlighting flaws in current crypto tax law.

Spain crypto tax

Proposed Changes to Cryptocurrency Taxation

The Sumar Parliamentary Group in Spain has introduced three amendments to the country's cryptocurrency tax laws, which would place a bigger financial burden on profits derived from Bitcoin and other digital currencies. Presented this month to the Congress of Deputies, the proposal suggests that gains from crypto assets—those not classified as financial instruments—should be taxed under the Personal Income Tax (IRPF) at the general rate, which currently can reach up to 47%, according to data from Wolters Kluwer.

Currently, gains from crypto assets are taxed under the savings base rates, which can go as high as 30%. Additionally, the proposed amendments would subject these gains to a 30% Corporate Income Tax.

As the third amendment, the proposal advocates for the establishment of a visual risk assessment system by the National Securities Market Commission (CNMV). This system would appear on investor platforms in Spain and would evaluate key factors such as official registration, supervision, backing, and liquidity of cryptocurrencies.

Economist and tax advisor José Antonio Bravo Mateu has pointed out that these changes “clearly go against Bitcoin, Ethereum, and other cryptocurrencies.”

The proposal also seeks to include all cryptocurrencies within the category of seizable assets, widening the scope of the existing rule that currently applies only to assets under the EU’s MiCA framework. Lawyer Chris Carrascosa mentioned that this proposal is “unenforceable.” She added, “If this is approved, it’s going to cause absolute chaos in the entire crypto tax regime in Spain.”

Demand for Crypto Traffic Light Risk Warnings

As previously reported by Cryptonews in July, a coalition of Spanish lawmakers pushed for the country’s top financial regulator to require a "traffic light" risk warning system for cryptocurrencies. This system aims to help users make informed decisions on the types of assets they wish to purchase. The Sumar Parliamentary Group has expressed a desire to rename cryptocurrencies, including BTC and ETH.

Economist José Antonio Bravo Mateu criticized these measures, labeling them as “useless attacks against Bitcoin,” and noted that cryptocurrencies are resilient to political pressures. He emphasized that these actions may lead holders in Spain to consider relocating their investments when the value of BTC rises significantly, disregarding political positions.

Ongoing Uncertainties in Crypto Taxation

In August, a notable incident arose when a Spanish trader was taxed €9 million for a crypto transaction that did not yield any profit. The Spanish Tax Agency (AEAT) classified a non-profit transaction as a taxable capital gains event. This situation has shed light on existing flaws within Spain’s crypto law and taxation framework, with legal experts and EU regulators cautioning that investors are left unprotected.

Lullius Partners, a Spanish tax firm, highlighted that the nation's tax legislation still lacks definitive guidelines on how cryptocurrency holdings and tokenized assets should be taxed. This ambiguity complicates the determination of when and under what circumstances cryptocurrency transactions are considered taxable events.