Nikolas Sargeant
The Czech Republic has advanced legislation that would exempt long-term Bitcoin holdings from capital gains tax. The proposed bill, announced by Prime Minister Petr Fiala, would eliminate capital gains tax on Bitcoin held for more than three years, aiming to attract crypto investors, entrepreneurs, and tech startups to the country.
The proposed changes also include simplifying tax reporting for smaller cryptocurrency transactions, with Czech residents no longer required to report trades under CZK 100,000 (approximately USD 4,200) annually.
Key Points of the Proposal
- Capital Gains Tax Exemption: Bitcoin held for over three years would be exempt from capital gains tax, encouraging long-term investment in digital assets.
- Simplified Tax Reporting: Transactions below CZK 100,000 annually would not require tax reporting, making crypto trading more accessible for individuals and small businesses.
- EU Regulation Alignment: The proposed reforms align with the European Union's Markets in Crypto-Assets (MiCA) framework, signaling the Czech Republic’s commitment to consistent regulation.
While the legislation has passed a first reading in the Czech Parliament, it has not yet become law. If enacted, the policy is expected to strengthen the country's position as a crypto-friendly destination and attract the next wave of digital economy innovation.
The Czech Republic’s proposal stands out in a global context where many countries, including the US and Italy, continue to impose capital gains taxes on cryptocurrency transactions.
