- They will pay only 4% of their income
- This is much lower than taxes in the US, which formally belongs to Puerto Rico.
- The island has been dubbed the mecca for blockchain
Puerto Rico accepted new crypto-friendly law. They added digital asset activities to the list of areas that qualify for the tax credit. Participants will now pay a reduced rate of 4%. The new rule applies to any transactions with digital currencies, including staking. Also, all companies that are engaged in the creation of blockchain projects or ensure their operation will enjoy the benefits.
The Blockchain Trade Association of Puerto Rico called the new law a “victory for the country.”
Recently, crypto millionaires have begun to move en masse to Puerto Rico. This is facilitated by tax incentives and a pleasant climate. The island’s authorities are offering tax breaks to blockchain companies if they operate legally. And private businessmen will receive a rate reduction if they spend at least 183 days a year on the island.
Puerto Rico is under the jurisdiction of the United States, but has the status of an independent region. The country is governed by the US Constitution, but with some restrictions. Puerto Rico also has its own vertical of self-government.
By comparison, in the US, investors must pay up to 37% in taxes on short-term capital gains and up to 20% on long-term income. Therefore, it is possible that more crypto firms will move to Puerto Rico soon.
