The Australian government will use data-matching and identification checks to pursue bitcoin investors for their tax liabilities, according to a report in The Australian.
Bilateral tax treaties and anti-money laundering powers will be used by the Australian Tax Office to try to ensure transparency in the crypto market, where the anonymity provided by the underlying blockchain technology is prized among some investors.
National Tax Liaison Group member Paul Drum said it was a “watershed moment for the ATO” and would “enabling them to access and thoroughly review cryptocurrency exchange account data for the first time.
“The effectiveness of the anonymity of Bitcoin and other cryptocurrencies is starting to fade. These coming changes mean that people shouldn’t assume they can hide forever behind blockchain technology, nor should they assume there are no tax consequences,” Drum told The Australian.
Bitcoin’s value has almost halved from its highs near $US20,000 in December and has been trading between $US10,000 and $11,000 lately. But as recently as 2015, investors could have entered the market when the price was under $300.
The price spikes at the end of last year saw a range of rapid interventions from regulators around the world. Regulatory risk remains an important driver of prices in the crypto market.
Bitcoin is not currently treated as money by the ATO, but as an asset.
In January it was reported the ATO had established a task force to monitor cryptocurrency transactions, and it now appears the ATO will be seeking to enforce 100-point identification checks on crypto buyers.
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