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Binance, a cryptocurrency exchange, has announced the debut of “Binance Tax,” a tool that will assist users in calculating their tax responsibilities on crypto transactions. The launch comes as many governments across the world have boosted their monitoring of cryptocurrency transactions in order to guarantee that people do not evade their financial obligations.
Binance announced the debut of a new tax tool on Monday, allowing users to compute tax-related cryptocurrency trading activity.
Binance Tax can accommodate up to 100,000 transactions and allows users to download a tax summary report of gains and losses made on the BINANCE platform. Spot trades, crypto contributions, and blockchain-based fork awards are included, but futures trading and NFTs are not.
The newly introduced tool is now in pilot mode and is only available to users in France and Canada. Still, Binance has stated that it will expand the effort to additional worldwide regions in the Binance ecosystem later this year. Binance Tax’s beta version, as it is, cannot interface with other platforms or wallets. According to the exchange, such linkages are planned, and the company is evaluating which integrations and enhancements “would be beneficial in the future for this product.”
Binance tax could not have come at a better time, as governments tighten their grip on cryptocurrency transactions to avoid losing any potential money. Italy implemented a capital gains tax framework for cryptocurrencies in December, charging a 26% capital gains tax on crypto earnings. The new rule, which goes into effect on January 1, 2023, also requires cryptocurrency owners to reveal their present holdings and pay a 14% tax on any such holdings.
Similarly, Portugal, which was long regarded as a crypto tax haven, declared a 28% tax on cryptocurrency held for less than a year in its 2023 budget proposal. Furthermore, the budget included a 4% taxes fee on free transfers of cryptocurrencies in cases of inheritance. Moreover, authorities proposed levying a 10% tax on free cryptocurrency transactions, such as airdrops. Notably, India implemented the worst crypto tax policy, imposing a 30% capital gains tax on cryptocurrency.
Furthermore, citizens must pay a 1% tax deducted at the point of sale on all transactions.
