Spain suggests implementing a 47% tax on Bitcoin and seizure regulations.

Spain is proposing new tax laws that would have a significant impact on bitcoin and other digital assets if enacted. The Sumar political party is behind these proposed changes, aiming to place profits from bitcoin into the general income tax category. This move would raise the top tax rate for individuals from the current 30% savings rate to 47%. Corporate holders, on the other hand, would be subject to a flat 30% tax rate under the proposed amendments.

One of the key aspects of Sumar’s proposal involves implementing a “risk traffic light” system for digital asset investments through the National Securities Market Commission. Additionally, the plan includes a provision to classify all digital assets, including cryptocurrencies, as attachable assets. This classification would make them eligible for seizure by authorities if deemed necessary.

However, not everyone is on board with these proposed changes. Criticisms have surfaced, with economist and tax adviser José Antonio Bravo Mateu calling the amendments “useless attacks against Bitcoin.” He argues that the proposed measures fail to grasp the decentralized nature of bitcoin, suggesting that they may drive holders out of Spain when the value of bitcoin surges to a point where the holders are indifferent to politicians’ statements.

The proposed amendments by Sumar also diverge sharply from recent suggestions by some tax officials for a more favorable regime for bitcoin. These proposals included allowing for the separation of wallets and the use of specific accounting methods. Nonetheless, the current plan by Sumar takes a different direction by proposing stricter tax regulations for digital assets.

In the realm of tax enforcement, Spain has been ramping up its efforts in recent years. The tax agency issued over 328,000 warning notices to digital asset holders in 2022 and more than 620,000 in the subsequent year. These enforcement actions demonstrate Spain’s commitment to monitoring and regulating the digital asset space within its borders.

On a global scale, the approach to taxing digital asset gains varies among countries. While Spain is moving towards a more stringent tax regime, Japan is considering reducing the tax burden on digital asset gains. The Japanese Financial Services Agency is looking to implement a flat 20% capital gains tax on digital assets, aligning them more closely with equities. This move could potentially enhance competitiveness for traders and businesses operating in Japan’s digital asset market.