- Since 2019, Puerto Rico has been in favor of digital assets with a tax of only 4% on investor earnings, a very low rate compared to other countries.
- Puerto Rico is discussing the possibility of taxing non-fungible tokens (NFTs).
Just over 3,500 kilometers from the United States is Puerto Rico. The island, which functions as a free state and has its own self-government despite belonging to the US, has its laws and is committed to becoming a good option for the crypto ecosystem.
Since 2019, the Puerto Rican government has been in favor of digital assets and launched regulations for a tax of just 4% on investor earnings. This tax exemption, which differs greatly from the percentages of other countries, has been extended, as announced by Iris Santos Díaz, secretary of the Department of Economic Development and Commerce of Puerto Rico.
Puerto Rico maintains tax extension
The staking and the export of crypto services fall within this tax incentive, as published CoinDesk.
“Puerto Rico has already been crowned a tax haven by cryptocurrency companies that have tried to take advantage of the country’s policies, so the move was not necessarily unexpected. But industry lobbyists are still fired up.”Santos stated.
According to Keiko Yoshino, executive director of the Blockchain Commerce Association of Puerto Rico, the 4% tax on generated income is “a victory for Puerto Rico.”
The country is not satisfied with what has been achieved and is going for more. According to the proposal presented last year and that could see the green light in this one, the island is currently discussing the possibility of taxing non-fungible tokens (NFTs).
Is Puerto Rico following in the footsteps of El Salvador?
Is it possible that Puerto Rico emulates what El Salvador has done? At the moment it does not seem to be the way to go, although there could be the option of continuing to open the borders to crypto enthusiasts. What the government of Nayib Bukele has done has generated a great impact on the entire industry.
In September 2021, during the great Bitcoin explosion that brought it to $68,000, El Salvador became the first country in the world to declare digital gold a legal tender. Later he began to apply mining from the energy of the region’s volcanoes.
After having opened a Bitcoin office in Lugano (Switzerland) in October last year, El Salvador is looking to have its own in Texas. He met with the undersecretary of the government, Joe Esparza, to work on new commercial projects and to launch the embassy. Will Puerto Rico enter into the plans after these news delivered by the island’s authorities?
Puerto Rico has a nominal GDP of more than $108 billion dollars and a population close to 3.5 million inhabitants. These numbers, if the bonanza for the cryptocurrency sector is maintained, could undoubtedly impact both numbers.
The expansion of digital assets is global and America continues to advance on this path. The region has long sought to become an important hub for the transformation that will come in the next decade.
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