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Investors evading taxes on crypto transactions, say Australian regulators

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  • Tax evasions have increased by investors in digital currencies as 300,000 yet to disclose transactions
  • Australian authorities to notify evaders and request them to duly file their returns and pay taxes according to the laws 
  • Cryptocurrency investments in Australia are scrutinised which has led to a safer investment environment 

The Australian Tax Office (ATO) has gone on record and stated that lakhs of cryptocurrency investors have not paid their taxes or not disclosed necessary investments in the digital space. Moreover, the regulatory authority sent a text message to all investors to reassess their point of view that investments in cryptocurrency are anonymous and untraceable. 

The ATO has collected data from various financial institutions and exchanges to verify the tax irregularities. Lastly, it reiterated that cryptocurrency investments are classified as property and not currency.  

Taxes will improve financial ecosystem 

The taxes paid by the investors will benefit the financial society at large and help smoothen the coordination between the growth of the economy and the functioning of various regulatory bodies. The ATO also mentioned that 100,000 crypto investors will be requested to reassess their previous tax returns. Additionally, 300,000 more crypto investors are to be notified about their investment disclosures. 

The Australian government is not the only one to impose taxes on cryptocurrency investments. South Korea recently imposed 20% taxes on cryptocurrency capital gains which is to come into effect from the following year. 

The UK, Norway and the United States of America have all imposed taxes on investments in digital currencies. Hence, Australia’s capital gains tax impositions should not be singled out.     

Moderate crypto regulations to protect investors 

It was in 2017 that the government made cryptocurrency investments legal and making them eligible under Anti-Money Laundering and Counter-Terrorism Financing Act. Moreover, the cryptocurrency exchange regulations in the country are robust and are a breeding ground for innovations and developments to take place. 

The regulations will be tightened in the coming years as several loopholes have been identified that need to be plugged. The increased scrutiny will not deter new entrants from investing in cryptocurrencies as the Australian government’s proactive approach is laudable. 

Tax impositions and reporting policies will lead to transparent disclosures by authorities in future. Australian cryptocurrency investors are protected from fraud as investments in the country are regulated proactively by the authorities.   

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