Cryptocurrencies are a very powerful and very novel source of money. Investing in crypto has generated wealth large and small everywhere. Be it with Bitcoin, Doge, Shiba or any other altcoin, many people have seen their money multiplied by 10, 100 or even 1,000. But with wealth comes taxes and with them some discontent.
The Principality of Andorra has a very relaxed tax policy when it comes to taxing income generated through digital activities such as cryptocurrencies
And dissatisfaction creates the desire to avoid these taxes. The easiest and most legal way is to pay taxes in another country. And few countries with non-traditional sources of income are more benevolent than the Principality of Andorra.
The loose fiscal policy of the tiny neighboring country has attracted quite a few neo-rich people who have made their fortune thanks to the Internet: Youtubers, streamers, professional gamers … have found a tax haven in Andorra. And now it’s the turn of cryptos, one of the main treasury targets of countries like France or Spain.
Andorra, in its mission to attract large fortunes (and especially those based on new technologies), has a tax regime for crypto that is very different from that of surrounding countries. In Spain, cryptos as well as stocks and other inherited goods are taxed. Pay 19% from zero to 6,000 euros21% from 6,000 to 50,000 euros and 23% from 50,000 euros, in Andorra only 10% is paid, and soon exorbitant … 0% could be paid as the Andorran government is studying that Possibility of tax exemption for crypto.
Not only that, but when withdrawing money from an exchange to a checking account in Spain you are likely to face a lengthy red tape. everything is easier in Andorra: You do not have to fill out Form 720 (the tax return for assets abroad) or submit any additional documents.
Undoubtedly, these terms are very favorable to anyone who has made significant profits with cryptocurrencies. It is therefore to be expected that professional crypto investors like Youtubers and other internet celebrities Start an exodus to little Andorra.
Although cryptocurrencies are currently in a period of decline, they are still a sector hovering around millions and becoming increasingly popular. As a result, Andorra is unlikely to reverse its plans to regularize cryptocurrencies.