Australian Taxation Office (ATO) has requested personal data and transaction details from crypto exchanges of up to 1.2 million accounts to crack down on potential tax evaders, Reuters reported. This move marks a significant escalation in the ATO's efforts to ensure compliance in the rapidly expanding digital currency market.
Oversight of Crypto Tax Compliance
ATO's notice, issued last month, aims to identify individuals who may have failed to report their crypto transactions. It focuses on instances where crypto assets were exchanged or utilized for payments without proper tax declarations.
ATO has acknowledged the complexities of thecrypto industry, attributing non-compliance to a lack of awareness regarding tax obligations. Additionally, the potential for anonymous transactions using false information poses a challenge in effectively enforcing tax laws.
The scope of the ATO's request extends beyond basic transaction details. It encompasses personal information such as dates of birth, phone numbers, and social media accounts. Additionally, the authority is seeking specific details like bank accounts, wallet addresses, and the types of coins involved.
Australia categorizes cryptocurrencies as assets for tax assessment, subjecting investors to capital gains tax obligations upon selling or trading crypto assets. This approach aims to ensure equitable taxation across traditional and digital asset classes.
Rising Crypto Adoption
A recent Treasury report indicating a significant growth in digital asset transactions highlights the exponential growth of Australia's crypto market. With over 800,000 taxpayers engaging in crypto activities in recent years, the country experienced a remarkable 63% surge in participation in 2021.
Meanwhile, Australia is preparing to embrace Bitcoin exchange-traded funds(ETFs), a move that could reshape the country's investment landscape. Following the footsteps of the US and Hong Kong, ASX Ltd, Australia's primary equity exchange, could soon allow the launch of Bitcoin ETFs, Bloomberg reported.
The soaring interest in cryptocurrencies among investors is evident in the $53 billion inflow into US Bitcoin ETFs this year. Notable players like Van Eck Associates Corp. and BetaShares Holdings Pty are poised to introduce similar ETFs in Australia. This comes amidst a resurgence in the crypto market, which recently drove Bitcoin price to a record high exceeding $70,000.
ASX, responsible for the majority of equity trading in Australia, is currently evaluating applications for spot Bitcoin ETFs. Although the exact timeline hasn't been confirmed, insiders speculate approvals could materialize before the end of the year. Australia's $2.3 trillion pension market stands as a crucial catalyst for Bitcoin ETF inflows.
This article was written by Jared Kirui at www.financemagnates.com.
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