Spanish authorities will force crypto holders to declare their crypto-related activities and crypto holdings. The country’s chief financial officer also announced that crypto exchanges will be forced to report on customer activities from next year – and warned that similar measures across the European Union has now been applied.
According to media outlet La Vanguardia, Spain’s Minister of Finance and Public Functions María Jesús Montero stated that government agencies are currently working on regulations that will “force cryptocurrency holders to submit” an annual statement of their token purchases and sales to the Treasury.
These measures will need to be put to a vote in parliament, but will likely be combined with other measures, such as legislation regarding tax rates for electricity suppliers. They may also be subject to anti-fraud laws, making their passage of parliament a virtual assault.
The minister stated that new regulations on cryptocurrencies will likely come into effect on January 1, 2023.
Montero added that Spain is acting “in anticipation” of regulations that will soon “be implemented throughout the European Union“, adding that other countries have already “working along the same path”.
Montero was quoted as calling cryptocurrency “a new [form of] currency” that the government “must be able to regulate” to ensure that “there is no kind of fraud or unwanted impact” affect the Spanish economy.
The CFO went on to add that the regulations will also seek to force “platforms and companies that facilitate the purchase or exchange of cryptocurrencies” to “submit an annual document” containing “information about cryptocurrency movements on their platform.” Exchanges will also be obligated to provide detailed information about the owners of all the coins on their platforms.
However, the Treasury will hope to avoid another embarrassment on the crypto tax return front. Earlier this year, tax authorities and government agencies, including the Ministry of Finance, were humiliatingly forced to step in after attempts to
caused Spaniards holding coins on overseas platforms to declare their holdings in trouble.
The tax authority has previously told citizens who hold tokens on overseas platforms that they should disclose their crypto assets on their annual overseas property tax returns in September 3 (at the end of fiscal year 2021).
The agency asked crypto holders with funds held on non-Spanish platforms to add their asset details to the asset declaration form. But this momentum was destroyed by obvious clerical errors: cryptocurrency holders complained that there were no fields in the aforementioned form for crypto holdings. This eventually forced the Treasury Department to make an eleven-hour turn-around and tell crypto holders that they don’t need to submit details of their overseas crypto holdings.