According to local reports, Slovenia’s Ministry of Finance is seeking public input on a draft bill related to taxing cryptocurrency investments.
The intention of the ministry to gauge investor sentiment comes nearly a month after the Financial Administration of the Republic of Slovenia proposed a 10% tax on cryptocurrency activities.
If signed into law under Slovenia’s Income Tax Act, the proposed bill would levy a 10% tax on all fiat-to-crypto conversions and cryptocurrency payments. The tax liability threshold, however, will be set at 15,000 euros ($17,387) for the calendar year. Crypto taxes will not be levied on investors who stay within the limit. The authorities had previously stated their motivation for enacting the crypto tax:
“We would like to emphasize that the amount a Slovenian tax resident receives on their bank account when converting virtual currency into cash or when purchasing something will be taxed, not the profit.”
The Slovenian draft crypto tax bill would only apply to the purchase of goods and services, as well as the conversion of crypto assets into fiat currencies. While the finance ministry’s proposal is expected to be approved by November 10, the law will go into effect on January 1, 2022.
The bill would also require Slovenian citizens to calculate the tax by taking into account the real-time value of cryptocurrency at the time of redemption and acquisition. Investors will also be required to pay a 25% tax on unrealized gains calculated by calculating the price difference between the purchase and sale of cryptocurrencies.
Individuals who fail to comply with their tax obligations will face fines ranging from 250 euros ($290) to 5,000 euros ($5,795) on a case-by-case basis.
According to a Chainalysis study, Europe’s crypto addition drive is exploding. Between July 2020 and June 2021, the central, northern, and western regions of Europe (CNWE) received more than $1 trillion in digital assets, according to the report. As a result, CNWE accounted for 25% of global cryptocurrency activity.