Slovakia’s National Council, the country’s legislative body, has endorsed an amendment to lower taxes on cryptocurrency profits, introducing a more favorable environment for crypto holders.

The amendment, approved on June 28th, brings a significant decrease in personal income tax on cryptocurrency profits, provided the digital assets have been held by the user for a minimum of one year.

Did you know?

Want to get smarter & wealthier with crypto?

Subscribe – We publish new crypto explainer videos every week!

The tax rate will drop to 7% from the current 19% or 25%, making it a more attractive environment for crypto investors.

Furthermore, the new law allows for payments received in cryptocurrencies of up to 2,400 euros (approximately $2,600) to be tax-free. Another major move is crypto income exemption from the standard 14% health insurance contribution.

Local media sources indicate that the Ministry of Finance expects the amendment to result in an estimated yearly financial impact of about 30 million euros.

The move comes on the heels of another significant legislative action. A few weeks prior, the parliament passed an amendment to the constitution that reaffirmed the right to use cash as a payment method amidst discussions regarding a potential digital euro.

Slovakia, one of the 27 member states of the European Union, is part of a region that closely watches developments in the crypto industry.

It’s worth noting that on May 31st, the EU enacted its prominent Markets in Crypto-Assets (MiCA) regulations. First proposed in 2020, MiCA aims to position Europe as a hotbed for digital asset activities and has been lauded by industry participants for offering regulatory clarity.

With the endorsement of a lower tax rate on cryptocurrency profits, Slovakia’s National Council is paving the way for a more crypto-friendly environment. This move is seen as part of a broader trend of European nations progressively adapting their legislation to accommodate the growing digital asset sector.