Europe and U.S. prepare crypto taxes: How their approaches differ

​Governments are increasingly looking for ways to generate revenue from cryptocurrencies. In Europe, new levies on crypto assets are now being discussed as part of the EU’s future budget, while in the U.S. lawmakers are proposing to modernize outdated tax rules for digital assets. Against this backdrop, crypto regulation is becoming increasingly intertwined with taxation.

Europe calculates revenues

In Europe, crypto taxes are being discussed as part of a broader idea: finding new sources of revenue for the EU budget for 2028-2034. According to Euronews, the European Commission estimates that new levies on digital services, online gambling and crypto assets could bring in almost €11 billion a year.

For the crypto market, two options are being considered. The first is a tax on the total volume of crypto transactions. According to preliminary estimates by the European Commission, a 0.1% levy on the value of transactions could bring in €3 billion to €4 billion annually. For example, if a user or company carries out a crypto transaction worth €10,000, such a levy would amount to €10.

The second option is a capital gains tax on crypto assets. In this case, the tax would not be charged on every transaction, but on profit. For example, if an investor bought cryptocurrency for €1,000 and sold it for €1,500, the taxable base would be €500. The European Commission estimates potential revenue from this approach more conservatively — at €1 billion to €2.4 billion a year.

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For now, this is not a finalized tax, but one of the options being discussed as part of negotiations over the EU’s future budget. The European Commission itself acknowledges that the estimates remain uncertain. The reasons are the high volatility of the crypto market and the difficulty of determining which country a specific user or transaction belongs to.

The U.S. rewrites the rules

The U.S. is discussing a different approach to crypto taxes. The American PARITY Act looks more like an attempt to update tax rules that are not keeping pace with the development of the market.

The bill has already been introduced in the U.S. House of Representatives. Its full name is the Digital Asset Protection, Accountability, Regulation, Innovation, Taxation and Yields Act. The authors of the initiative believe that the current rules remain outdated and create uncertainty for investors, companies and regulators.

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The PARITY Act addresses several controversial issues at once. For example, it proposes a separate regime for dollar-pegged stablecoins so that such “digital dollars” could be used more like cash, without complex tax consequences for every small transaction.

Another point concerns miners and stakers. The bill is intended to solve the problem of so-called phantom income, where a person may face a tax liability before actually selling the asset and receiving money. The document also clarifies rules for crypto loans, charitable donations in digital assets and professional traders.

The bill also separately addresses small crypto transactions. The U.S. Treasury Department and the IRS are asked to study the possibility of introducing a de minimis exemption — that is, a potential tax exemption for small transactions. The agencies would have to assess the burden on taxpayers and separately examine how many transactions of up to $200 currently fall under IRS reporting.

What applies now

The new initiatives did not appear out of nowhere. In the U.S., cryptocurrencies are already taxed: the IRS treats digital assets as property, not as currency. Therefore, selling, exchanging or using cryptocurrency can create a taxable event if a person makes a profit.

For example, if an investor bought bitcoin for $10,000 and sold it for $15,000, the $5,000 difference is usually treated as a capital gain. If a person received cryptocurrency from mining, staking or as payment for work, that income may be taxed as ordinary income. As a result, even small transactions can create complicated reporting requirements for users.

There is currently no single crypto tax in Europe. MiCA sets common rules for crypto companies, stablecoins and service providers, but it does not introduce a common tax regime for all EU countries. Therefore, taxation of crypto assets remains at the level of individual states.

In practice, this means that the rules can differ significantly. In one country, profit from selling cryptocurrency may be taxed as capital gains; in another, as investment or business income. Rates, exemptions, holding periods and approaches to income from staking or mining may also vary.

Two different logics

The approaches of Europe and the U.S. differ not only in their details, but also in their overall logic. In the EU, crypto taxes are being discussed as a possible source of revenue for the common budget. In the U.S., the focus is different: the PARITY Act does not so much introduce a new tax as try to make existing rules clearer for users, investors and companies.

At the same time, in both cases, taxes do not exist separately from broader crypto regulation. In Europe, new levies could work on top of the already active MiCA framework. It does not introduce a single crypto tax for the entire EU, but it creates a clearer market infrastructure on which tax decisions can later be layered.

In the U.S., other bills currently being discussed alongside the PARITY Act could play a similar role. For example, the CLARITY Act is intended to more clearly divide the powers of the SEC and the CFTC and determine which digital assets are closer to securities and which are closer to commodities. If such rules are adopted, tax rules will be easier to apply in practice: both the government and market participants will better understand what exactly is regulated, who is responsible for it and which transactions fall under reporting.

Therefore, the difference between the EU and the U.S. looks like this: Europe first builds a common market for crypto services and then discusses new sources of budget revenue, while the U.S. is trying to close several gaps at once — in regulation, asset classification and tax reporting. In both cases, the crypto industry is gradually moving out of the gray zone: first through regulation, and then through clearer tax mechanisms.