• 01/12/2023

Reduction of the capital gains tax rate

A reduction of the capital gains tax rate from 0. 5% to 0. 2% is foreseen in the new tax bill under consultation. This is the second reduction of the capital gains tax (CGT) rate within the last five years, following its reduction from 1% to 0. 5% (currently in force) in 2021. A typical case where this tax liability arises is the increase in the capital of capital companies or partnerships by means of a contribution of all kinds of assets. The FSC is calculated on the actual value of the transferred assets, while in case of an increase in the share capital of a public limited company by issuing shares for par value (issue of shares at a price higher than the nominal value), this tax is imposed only on the amount of the par value. Subsequent capitalisation of this amount will, however, constitute a capital increase subject to an FSC.