Spain passes new crypto asset declaration law for citizens

A new law approved by Spain’s Council of Ministers will oblige private citizens to declare their cryptocurrency holdings, in a landmark development for crypto regulation.

As part of new anti-fraud measures presented by Finance Minister María Jesús Montero, the bill requires an annual disclosure of crypto holdings, as well as any offshore fiat holdings, to tax authorities, Spanish news outlet ABC.es reported.

The law aims to claw back an additional €850 million ($966.43 million) in tax, at a time of severe budgetary pressures in Spain. With youth unemployment as high as 33.8%, the Spanish government has been investigating existing loopholes to deliver the extra revenue it needs.

Previously, cryptocurrency activity has been largely unregulated in Spain, with the suggestion that there could be significant private holdings of crypto presently undisclosed to tax authorities.

With the need for revenue more pressing than ever, the Spanish model could eventually inspire similar moves from other governments.

Earlier this year, the United Kingdom, United States, Australia, Canada and the Netherlands joined forces under the banner of the J5 Joint Chiefs of Global Tax Enforcement partnership—an transnational body for tackling tax evasion, which could ultimately adopt similar proposals.

The bill also institutes a 0.2% transaction tax on listed shares worth over €1 billion ($1.14 billion), with some commentators speculating this could ultimately extend to cryptocurrency transactions.

“Tobin Tax” provisions within the law seek to apply taxes on the difference between opening and closing positions on the day, in what could potentially deal a significant blow to crypto traders deploying intraday strategies.

According to press reports, the Spanish government is also stepping up its enforcement efforts, with an additional 200 officials assigned to a new taskforce. As well as expanding the list of countries deemed to be tax havens, the bill will also introduce new infrastructure for instant VAT reporting.

The news confirms the increasing interest paid by governments and tax authorities to the crypto holdings of their private citizens. As regulatory oversight steps up in cryptocurrency markets, and now on cryptocurrency investors, these developments leave investors open to potentially significant liabilities to domestic tax authorities.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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Spain introduces law to force investors to reveal crypto holdings

Spanish cryptocurrency enthusiasts just received a bit of news that won’t make most of them happy. A local news outlet in the country, ABC, reported last Friday that the government has signed off on a draft bill that would force crypto investors to reveal their holdings in order to properly assess taxes on the digital assets.

The new rules were announced during a press conference held by Spain’s finance minister, María Jesús Montero. The change in legislation will force all Spaniards to declare the assets whether they live in the country or overseas. Montero explained that, with the new legislation, the government would be able to identify crypto holders, as well as “the balances contributed by these virtual currencies.”

Spain is working on increasing regulation over the crypto industry. This year alone, it has sent requests to more than 60 businesses, asking them to provide identification of their users. Should the draft bill be accepted as law, crypto holdings will be required for inclusion into the 720 form, Spain’s tax reporting structure. Those that don’t properly report their assets through the tax filing can be fined as much as $5,745 for each discrepancy.

In addition, according to ABC, the draft bill “will include the prohibition by law of new tax amnesties . This was an old announcement by the former minister, Cristóbal Montoro, and results in a measure of little influence: tax amnesties may continue to be approved, although this will require reforming the current anti-fraud law, which introduces a new obstacle, but little else.”

The European Union (EU) currently doesn’t have standard regulations for cryptocurrencies, particularly when it comes to cryptocurrency. Some countries, such as Poland, have reversed course on previous legislative efforts to address taxes. Others, including Malta and Portugal, have established policies in place to ensure the governments can collect taxes on crypto assets.

Despite the lack of regulations, the EU is moving toward recognizing crypto as a legitimate currency. An announcement released recently by EI officials stated, “A digital representation of value, not issued by a central bank, credit institution or e-money institution, which in some circumstances can be used as an alternative to money.”

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.

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