The Spanish Ministry of Finance is seeking to increase the scope of its oversight over crypto activities within the nation,
This will allow them to seize digital assets to pay off tax debts. Let’s discover more about this important news.
Spanish Authorities Implement New Strategy to Tackle Tax Evasion
Reports state that the ministry, headed by María Jesús Montero, is working on changes to Article 162 of the General Tax Law. This would enable the Spanish Tax Agency to locate and seize crypto assets that taxpayers with past-due bills own.
The news comes after a regulation from February 1st that increased the number of organizations required to provide tax information to the Treasury, including savings banks, banks, and electronic money institutions.
The Spanish Treasury plans to adopt a more robust stance against tax evasion. It seeks to compel banks and other electronic money providers to disclose every card transaction. These measures are part of Spain’s proactive efforts to regulate the digital asset industry.
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Different countries have taken different paths towards identifying cryptocurrencies as different things in their country, as we can see some countries have declared crypto to be an asset that has some financial value attached to it.
— Sayanta (@sayu907) February 5, 2024
Spanish tax authorities issued more than 325,000 warnings 2023 to Spanish residents who failed to disclose their crypto holdings. This was a huge increase from the 150,000 warnings issued in 2022. It also demonstrates how much the government is focusing on ensuring the crypto tax ecosystem is compliant.
In addition, Spanish residents who possess cryptocurrency assets on non-Spanish platforms have until the end of March to report them to the relevant tax authorities. A new policy implemented on December 31, 2023, requires both individual and corporate taxpayers to disclose the amount of funds held in their foreign crypto accounts.
However, the policy requires only those whose bank sheets show ownership of crypto assets exceeding the equivalent of 50,000 euros, to disclose their holdings abroad. Interestingly, Spanish authorities require individuals who keep their assets in self-custody wallets to report those holdings using Form 714, Standard Wealth Tax.
#CryptoNews: The proposed reforms to the General Tax Law, specifically Article 162, would allow the local tax agency to confiscate crypto assets and digital collectibles.🇪🇸https://t.co/8QWc0aVuob
— CoinMarketCap (@CoinMarketCap) February 6, 2024
Obstacles to Implementation
Although Spain has taken noteworthy steps to tax and regulate cryptocurrencies, there are still some possible obstacles. There could be possible obstacles to implementing these policies.
Furthermore, authorities could face issues in tracking and seizing self-custodied cryptocurrency assets. This is because these wallets are inherently private.