Australia will take up a number of measures to chase down its crypto-investors that are using offshore means to evade taxes. The Australian Tax Office (ATO) believes that cryptocurrencies are an asset and that citizens must pay taxes on all profits they receive. The law will be enforced through a method of income data comparison between Australia and other countries.
Australia has an agreement on sharing data with other countries in order to track those trading offshore. Thus, ATO will be able to reveal “unexplained wealth and conspicuous consumption that may arise through profits derived through cryptocurrency investment,” said deputy commissioner Martin Jacobs.
ATO set out new encryption rules that will allow the department to effectively track transactions of any individual investor registered in local crypto-exchanges. The office will also impose a crypto profit tax on the individual's marginal rates once the asset is sold or transferred. Australian taxpayers may be eligible for a 50 percent CGT discount if the asset is held for more than 12 months.
At the same time, the country's tax lawyers have inquired to ATO, to issue further recommendations. According to their statements, they came across a variety of cases, which can be interpreted differently.
Offshore structures are causing Australian immense damage, which leads the government to joining forces with four other nations US, Canada, the Netherlands and the UK. The alliance was named J5 and will combat cryptocurrency related crimes. According to the group's representatives, banks can no longer rely on traditional principles in their pursuit to end money laundering, so the regulators suggest that the credit organizations based in those five countries joined together.
By Ekaterina Ulyanova