Spanish cryptocurrency owners might soon have to declare their holdings, according to a government proposal. Should it be adopted, holders of virtual assets would need to declare them to the Agencia Tributaria, the Spanish tax service, using a 720 form which is used to report all assets held by an individual. A €5000 fine can be levied on anyone who fails to disclose or intentionally underreports their holdings. The proposal, which still has to be approved, is in line with the desire for regulation in the crypto space by governments. On September 3rd it was reported that the EU is keen to further talks about cryptocurrency regulations, an ambition clearly matched by some within the Spanish government.
Japan Leads the Way
Cryptocurrency taxation might be getting a little bit easier in Japan after a taxation policy committee stated its desire to simplify cryptocurrency taxes. During a meeting at the General Assembly, it was claimed that current tax laws are over-complicated and are leading to individuals either not knowing how to report earnings, reporting them incorrectly or simply not reporting them at all. Virtual currencies, they state, should be regarded as a new economy type and therefore will need a new taxation policy to ensure that gains are accurately reported and taxed. Such attitudes make a refreshing change and show a desire by Japanese authorities to help cryptocurrency investors pay tax rather than just chasing those who don’t, or don’t know how.
A Taxing Situation
Accurately calculating tax owed on cryptocurrencies has long been a headache for many investors, and authorities face a trade-off between allocating resources to make it easier to report cryptocurrency earnings or potentially miss out on collecting taxes from investors. Implementing regulations to limit illegal use of cryptocurrencies and make it safer for investors is welcomed by many, but at the same time those new investors have a right to expect a simple taxation method so they can be sure they are staying the right side of the law.