Spain’s Crypto Crackdown: 47% Tax, 328K Warnings & Why 9% of Spaniards Still Own Bitcoin

Spain’s left-wing Sumar parliamentary group has introduced a sweeping set of amendments that could redefine how cryptocurrency is taxed, regulated, and even legally classified within the country. As Spain becomes one of Europe’s fastest-growing crypto markets, these proposals are generating intense debate, particularly among Bitcoin investors, tax experts, and digital-asset professionals.

To help you fully understand what is happening, why it matters, and how it affects investors, the article below breaks down the developments in an analytical and explanatory way.

Rising Crypto Adoption Sets the Stage for Stricter Tax Reforms

Spain’s crypto landscape has grown dramatically over the last two years, with adoption rates among the highest in the European Union. According to the European Central Bank:

• Crypto ownership has more than doubled, rising from 4% in 2022 to roughly 9% in 2024–2025.

• More than 57% of Spanish holders use crypto as a long-term investment.

• The digital asset market in Spain is expected to generate over $1.3 billion in 2025, with projections rising to $2.4 billion in 2026.

Additionally, forecasts suggest that the number of Spanish crypto users could jump from 15 million to more than 25 million within a year, reflecting a rapidly accelerating shift toward digital assets.

This explosive growth has placed pressure on Spain’s tax authorities, pushing the government to tighten reporting requirements and strengthen enforcement mechanisms.

What Exactly Is Sumar Proposing? A Breakdown of the New Crypto Tax Plan

Sumar’s proposal modifies Spain’s General Tax Law, Income Tax Law, and Inheritance & Gift Tax Law, making the country’s crypto tax system significantly stricter and more complex. Below is a clear breakdown of the key components.

1. Crypto Gains Move to the High-Income Tax Bracket

Under current law, trading gains fall under the “savings income” bracket (19%–28%).
Sumar wants crypto gains taxed as general income, which pushes the rate as high as 47%.

This means:

• Small investors face higher taxes.

• High-income individuals lose the 30% upper limit they previously enjoyed.

• More crypto benefits will be treated like traditional salary income.

2. Corporations to Pay a Flat 30% Crypto Tax

Businesses holding or trading crypto would face a fixed 30% tax, eliminating flexibility and increasing operational costs for Web3 startups, fintech companies, and trading firms.

3. A Mandatory “Risk Traffic Light” System

The CNMV would be required to implement a visual risk-classification tool similar to nutrition labels or energy-efficiency ratings.

This warning would appear on:

• Exchanges

• Broker apps

• Investment platforms

• Educational material

• Crypto advertisements

The goal is to help inexperienced investors understand volatility, liquidity risk, and regulatory uncertainty.

4. Crypto Classified as “Attachable Assets” Eligible for Seizure

Sumar proposes making all cryptocurrencies seizable in legal situations such as:

• Tax debt

• Court actions

• Bankruptcy

• Criminal investigations

However, legal experts argue this is impossible for assets held in decentralized self-custody wallets. Tokens like USDT, which cannot legally be stored with MiCA-regulated custodians, also cannot be seized in the traditional sense.

Why Critics Call It an “Attack on Bitcoin”

The proposal has sparked a fierce backlash.

Bitcoin’s Self-Custody Nature Makes Seizure Unrealistic

Economists argue lawmakers do not understand how decentralized assets work. Bitcoin stored in a private hardware wallet cannot be forcibly seized without physical access to the owner’s seed phrase.

Risk of Talent and Capital Flight

Experts warn that high taxes could push Spain’s growing crypto community abroad, especially to countries offering friendlier tax regimes like Portugal, Germany, Switzerland, or even the UAE.

A Growing Disconnection Between Policy and Adoption

While the public rapidly adopts crypto, the government tightens restrictions — creating a mismatch that could slow innovation.

Spain’s History of Intensifying Crypto Enforcement

Spain has been one of the strictest European countries when it comes to monitoring crypto activities.

Hundreds of Thousands of Tax Notices Issued

• 2021: 15,000 warning letters

• 2022: 150,000+

• 2023: 328,000

• 2024: 620,000+ (projected)

This large spike shows regulators now view crypto as a major revenue source.

New Reporting Requirements: Form 721

As of 2024, any Spanish resident holding over €50,000 in crypto on foreign exchanges must report it using the new Form 721. Failure to declare can result in heavy penalties.

Proposed Alternative: A More Reasonable Bitcoin-Focused Tax Regime

Not everyone agrees with Sumar’s approach. Two Spanish tax inspectors, Juan Faus and José María Gentil, have suggested a more practical and investor-friendly system.

Their proposal includes:

• Separate wallet categorization

• Choice between FIFO or weighted-average accounting

• Clear valuation rules for inter-wallet transfers

• A simplified tax mechanism tailored specifically for Bitcoin

This approach is seen as a balanced solution that avoids driving away investors while still ensuring compliance.

How Spain Compares with Other Countries

Japan: Moving Toward a Flat 20% Crypto Tax

Japan’s Financial Services Agency is pushing to streamline crypto taxation by:

• Eliminating the 55% progressive tax

• Introducing a flat 20% capital gains tax, similar to stock investments

• Encouraging crypto startups to stay in Japan rather than relocating

The EU Landscape

• Portugal: Nearly tax-free for long-term holders

• Germany: 0% tax if crypto held for more than one year

• France: Flat 30% crypto tax

• Italy: 26% capital gains tax

Spain’s proposed 47% tax would be among the highest in the European Union.

What This Means for Investors Going Forward

If Sumar’s proposal becomes law, the implications for investors are significant:

1. Higher Taxes and Lower Net Gains

Profitable investors will pay substantially more than they do under the current savings-income system.

2. Increased Compliance and Reporting Burdens

More forms, more monitoring, stricter enforcement.

3. Possible Migration of Crypto Talent

Entrepreneurs, traders, and developers may choose countries with friendlier tax policies.

4. Uncertainty Could Slow Innovation

Investment in Spain’s crypto startups may decline if regulations become unpredictable.

Conclusion: A Nation at a Crossroads

Spain stands at a critical turning point.
On one hand, it is one of Europe’s fastest-growing crypto markets, with millions joining the digital-asset ecosystem. On the other, the government is considering harsh tax measures that critics argue will hinder innovation, push investors abroad, and fail to address the realities of decentralized technology.

Whether Spain becomes a leader in crypto innovation or a cautionary tale of over-regulation will depend on how lawmakers balance investor protection with economic growth — and whether they adapt policy to match the rapidly evolving digital financial landscape.