Cryptocurrency tax is on the rise across the world as more and more countries reveal their cryptocurrency tax policy. The latest addition to the list is Venezuela, where the government has announced a 20% tax on all cryptocurrency transactions.
Why tax on cryptocurrencies?
Several countries have already introduced tax policies regarding Crypto earnings since the beginning of 2022.
IN ONLY: The Venezuelan government has passed a new 20% tax on #Bitcoin and #cryptocurrency transactions. — Watcher.Guru (@WatcherGuru) February 8, 2022
Venezuela’s National Assembly reportedly held a second discussion session on Thursday on a new bill targeting taxes on “large financial transactions” in cryptocurrencies such as Bitcoin.
In the second discussion held on the project last week, the Venezuelan government reportedly gave its approval. Local businesses and individuals will now be required to pay up to 20% for trades made with any cryptocurrency except the Venezuelan bolivar, along with the oil-backed cryptocurrency El Petro.
The purpose of this law is to give greater incentive and confidence to the use of the national bolivar, which has lost almost 73% of its value in the last year alone.
Crypto tax wave or global adoption
The cryptocurrency ecosystem that debuted in 2009 has seen a huge increase in adoption around the world in recent years. Many nations, tax authorities and regulators are still debating how to control it, while some countries have already made up their minds.
Countries like the US and Canada have legally allowed trading in virtual currencies, on the other hand, nations like China and Russia have banned it by law. A country like El Salvador has already legalized any cryptocurrency, including bitcoin, for use as legal tender, while India recently recognized Bitcoin and other cryptocurrencies during the budget session and announced a flat 30% tax on the income generated by it.