Albania to Introduce Taxation for Crypto Transactions from 2023
- The draft law introduces the concept of taxing virtual asset income and crypto holdings.
- According to the new law, any income from crypto transactions or mining will be considered corporate income when received as a result of business activity.
According to the new income tax bill, the Albanian state will soon tax cryptocurrency trading from 2023.The draft law, currently at the public consultation stage, introduces the concept of taxing virtual asset income and crypto holdings.
The law describes virtual assets as a digital representation of a value that can be deposited, traded or transferred in digital form and that can be used for payment or investment purposes or as a medium of exchange, including but not limited to cryptocurrencies.
As part of the new legislation, any income from crypto transactions or mining will be considered as corporate income when it is received as a result of business activity. If beneficiaries of the trade are private individuals, they will have to pay a capital gains tax of 15%.
The latest development comes in the wake of the Albanian parliament ordering the Financial Supervisory Authority (AFSA) to adopt new regulations regarding cryptocurrencies by 2022 end. In November last year, the AFSA approved its first two regulations implementing the crypto markets law, introducing capital and licensing requirements for entities working with digital assets. Albanian policy approves crypto trading channels, but the state is yet to have licensed businesses actively trading cryptocurrencies.
In 2020, Albania made headlines when it adopted a law called “Financial markets based on distributed ledger technology”. The Law on Financial Markets Based on Distributed Registry Technology came into on September 1, 2020. However, its full implementation is still underway. Under the law, crypto-related activities in Albania require licenses under the law, and Blockchain-based financial systems are subject to regulatory scrutiny. Apart from Albania, South Korea also recently announced plans to levy a 20% tax on cryptocurrency gains exceeding US$38,624.95 starting in 2025.