TIRANA, June 24
Albania is considering a move to tax gains on cryptocurrency transactions and mining starting January 2023. The latest tax bill on income, which is now available for public consultation, plans the taxation of cryptocurrency.
The bill also provides an official definition of the ‘virtual asset’ and mining concepts. Even though a law ‘On financial markets based on distributed ledger technology’ came into effect in September 2020, this is the first time that virtual assets and mining have a proper definition.
Thus, virtual assets are defined as a digital representation of value that can be digital, deposited, traded, or transferred and can be used for payment or investment purposes or as a medium of exchange, including but not being limited to cryptocurrencies.
However, the definition does not refer to digital representations of CBDC currencies officially recognized as issued or backed by central banks or public authorities; securities, and other financial instruments that are provided by the legislation in effect.
Moreover, the bill defines mining as the activity of utilizing the computing power of the system users to solve cryptographic algorithms for transaction authentication and to obtain virtual instruments in exchange, as well as the transaction confirmation through investments in virtual tools defined by the users of computational nodes participating in the process.
Further on, the bill defines that any profit generated from crypto transactions and mining by a person residing in Albanian will be an object of income tax. This will apply both to individuals and businesses.
The calculation of the virtual assets values will be defined in a guideline by the minister’s office responsible for finances. The public consultation stage for this bill will be open until June 16th.