“I believe in the future, I believe in Bitcoin.” With these words, Miguel Albuquerque, President of Madeirathe entry of the Portuguese island into the Bitcoin standard. But shortly after the announcement, things got quiet again around the island, which has a population of 250,000. BTC-ECHO takes a closer look: What could a Bitcoin future look like for Madeira and do the recently announced tax increases stand for Cryptocurrencies in Portugal doesn’t that contradict it?
Miguel Albuquerque wants to make Madeira a “fantastic environment for Bitcoin”. Since 2015 he has been president of the autonomous island, which, although part of Portugal as a special economic zone, enjoys some of its own tax laws. Bitcoin, for example, does not want to be taxed by the government. This means that anyone who realizes speculative gains with cryptocurrencies or spends them pays no capital gains taxes. However, Bitcoin will not become legal tender, says Madeiran entrepreneur André Loja Cointelegraph.
We don’t “adopt” bitcoin because that would make it look like making it legal tender, when in fact it is already legal.
Andre Loja
That means: In Madeira there is – if at all – a bitcoin adoption light. The cryptocurrency will not become a legal means of payment for which acceptance is compulsory and with which one can also pay taxes. Despite this, Albuquerque caused a stir and applause with its announcement at Bitcoin 2022. Rightly so: Because even without the status of legal tender, the island off the coast of Morocco could develop into a bitcoin hotspot. With the Sound Money Foundation According to the entrepreneur, Loja has been running a Bitcoin Education Center for some time, in which well-known Bitcoiners such as Knut Svanholm are also involved.
The low tax burden should be particularly attractive for Bitcoin companies. With a corporate tax rate of just 5 percent, there are few places in the European Union with more attractive corporate taxes than Madeira. companies like the watch manufacturer swatch have already followed the call.
Madeira doing its own thing?
However, the liberal course is in contrast to the efforts of the central government in Lisbon, which would like to tighten the bandages again when it comes to bitcoin taxation. As BTC-ECHO reported on May 17, Finance Minister Fernando Medina wants to levy capital gains taxes on BTC sales. So far, legislation has classified Bitcoin and Co. as currencies, which is why capital gains are tax-free. However, that could soon change – also on Madeira.
Because it is questionable where the competence to determine the capital gains tax in Portugal lies. While Albuquerque has promised that “individuals who buy bitcoin and sell, pay no taxes”. So far, however, this applied to all of Portugal and was not a special feature of the special economic zone. So did Albuquerque promise too much? Did he reckon without Lisbon?
A request to the regional government in Madeira remained unanswered at the time of going to press.
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