Minister of Finance in Hungary, Mihály Varga, announced in a video on his Facebook page that the country will be lowering income taxes on cryptocurrencies to 15%. This reduction will take effect in 2022. Currently, income from cryptocurrency mining is taxed at 30.5%, with capital gains charged over 26.5%.
While announcing the upcoming changes in taxation, Mihály Varga said that:
“Hungary is finally taking a step towards ‘whitening’ cryptocurrency incomes. As of now, tax rate on cryptocurrencies is at 30.5% which will be lowered to 15%.”
He then said that this change “could bring in billions of Hungarian Forints to the budget”. (1 US Dollar is around 295 Hungarian Forints.)
Under the current tax system in Hungary, cryptocurrencies are not considered “money” for tax purposes. Trading income falls under “other income”. For miners, it counts as self-employed activities. Taxes on crypto are only due when cryptocurrencies are exchanged into fiat money. Because crypto falls under “other income” the effective tax rate is now 26.54%
The proposed changes will now be reviewed by the parliament. It is expected the changes will be accepted and that changes can take effect as early as next July.
Mihály Varga further announced a wide range of other tax cuts aimed at simplifying taxes as to restart the country’s economy after it was hit hard by the pandemic.
The post Hungary to significantly cut taxes on cryptocurrency appeared first on iGaming.