The Czech Chamber of Deputies is currently debating the implementation of EU regulations in the area of financial market digitisation and sustainability financing. An interesting tax amendment has emerged during the debate which, if adopted, may have a very positive impact on individuals trading in crypto-assets.

The amendment proposes, among other things, the introduction of a 3-year time test for exemption from personal income tax for the sale of selected crypto-assets and the exemption of income from the sale of crypto-assets up to CZK 100 thousand per year. This is practically a similar tax exemption regime as that for income from the sale of securities.

While this is an interesting initiative from our perspective, we believe that with the current situation of the state budget (combined with the current flood situation), the state is unlikely to be willing to introduce a new exemption in a relatively dynamic sector and thus sacrifice a potentially large portion of tax revenues of the state budget. Moreover, it needs to be taken into account that crypto-assets are perceived by some officials as a form of difficult-to-control economy with a high potential for abuse. We can therefore only wait and see how this amendment will turn out.

If you have any questions about crypto-assets and their taxation, please do not hesitate to contact our experienced team.