Portugal’s Tax U-Turn Further Underlines The Attractiveness Of Gibraltar As A Crypto Destination
It might not have escaped the notice of a significant proportion of our service users in recent days that there has been major news on Portugal’s relationship with the crypto space.
Specifically, the southwestern European country that has done so much in recent years to lure crypto investors with measures such as its Golden Visa and a ‘hands-off’ approach to crypto, has indicated that cryptocurrencies there will shortly become subject to taxation.
If, then, you are a current or would-be crypto investor in Portugal, this development — ostensibly designed to ‘level the playing field’ in how crypto is treated compared to other asset classes — might give you fresh reason to look seriously at Gibraltar as the focal point of your own activities in this space.
What did Portugal say about the prospects of it taxing cryptocurrencies?
It was the Portuguese finance minister, Fernando Medina, who signalled in recent comments to the country’s parliament that changes were afoot to the government’s approach to crypto.
The minister was quoted as saying, by CoinDeskand other sources, that “many countries already have systems, many countries are building their models in relation to this subject [the taxation of crypto] and we will build our own.”
An associated partner at a Lisbon law firm, Susana Duarte, said that the Portuguese government had indicated it would proceed with taxing crypto, with the new policy set to include a capital gains tax. However, she added that the government had not yet made clear how staking or yield farming might be impacted.
The implications of Portugal’s shift in policy for you
There is much in Portugal’s revised policy towards crypto that we are yet to know, including exactly when such a tax will be implemented. However, even just the shift in tone from the country’s government might lead you to consider the legal, regulatory and tax stability that Gibraltar offers for cryptocurrency investors.
There’s no doubt about it; crypto is a fast-evolving space, with much uncertainty presently prevailing about national authorities’ likely treatment of the industry in the months and years to come.
Gibraltar, however, has been ‘ahead of the game’ in crypto in more than a few ways. The British Overseas Territory’s Distributed Ledger Technology (DLT) framework was implemented way back in 2018, and various large and highly respected crypto exchanges now hold licences from the Gibraltar Financial Services Commission (GFSC).
As for if you are interested in achieving an AML compliant token sale, it may interest you to know that Gibraltar has put in place a sturdy VASP (virtual asset service provider) registration system, which directly connects project principles with the regulator to allow for the most stringent AML (anti-money-laundering) and KYC (know your customer) checks.
Although token issuing entities are not yet licensed by the regulator, the registration and approval process that is already in place helps give peace of mind to both investors and third-party service providers.
Note, too, that Gibraltar has a reputation as a broadly low-taxation environment, and this very much extends to its crypto approach. The Gibraltarian government does not impose any capital gains or dividend tax requirements on cryptocurrencies, and the territory’s current regulation sets out that even exchanges only need to pay a 12.5% corporate income tax rate.
So, while there is much that might seem uncertain and even scary about the crypto sector and how it is treated from a taxation or regulatory perspective in various jurisdictions around the world, that is much less the case in Gibraltar.
Why wait any longer to begin your relationship with our experts? For a more in-depth discussion of your needs and expectations from your looming AML compliant token sale or whatever your other aims and ambitions might be in crypto, please do not hesitate to get in touch with the TAG Consultancy team today.