Spanish Treasury proposes to allow the Tax Service to confiscate citizens’ crypto assets to pay off debts

Previously, citizens were obliged to declare crypto assets on foreign exchanges

05.02.2024 - 15:22

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What’s new? The Spanish Treasury has proposed a tax reform that would allow the confiscation of crypto assets of citizens to pay off their tax debts. Spain was one of the first countries in the European Union to implement tax regulation of digital assets. From 2021 users must pay income tax on cryptocurrency transactions, as well as property tax based on the value of digital assets in possession. From this year, citizens must also declare assets held on foreign exchanges.

Material by El Economista

What else is known? The Spanish Treasury first put forward this initiative in 2021. It proposes to amend Article 162 of the General Tax Law, under which the Tax Service will be able to take into account the cryptocurrencies of citizens when collecting debts. To be able to seize digital assets, it is also proposed to amend the General Rules of Tax Collection.

As the local publication El Economista writes, the authorities are moving quickly to implement the reform. Thus, on February 1, a decree came into force, according to which crypto firms are included in the list of organizations responsible for tax collection. This means that they must freeze clients’ crypto assets when requested by the government. Previously, this was only required of traditional banks and credit institutions.

Argentina abolishes tax requirements for cryptocurrencies

Interior Minister Guillermo Francos said Congress had not reached a consensus on the initiative

Earlier, the media reported that Indonesia’s tax policy caused crypto exchanges’ trading volume to drop by 60% in a year. Now local users pay income tax and VAT for each transaction, and exchanges contribute a percentage to the state industry organization.

Japan will abolish tax on unrealized profits in cryptocurrencies for legal entities from April 1 this year. According to the Cabinet, this will attract startups and institutional investors to the country.

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