At the latest G20 summit in Buenos Aires, Argentina, leaders of the member nations agreed to bring upon an International Cryptocurrency Tax. All the member nations have signed a document to collaborate and work in this regard.
The G20 declaration states:
“We will seek solutions for the international taxation issue accompanying the digitization of the economy and will continue to collaborate”.
New Framework for International Crypto Tax
Japanese publication Jiji.com reports that the member countries will consider the crypto industry as a “huge IT company” to develop the taxation framework around it. Furthermore, the new framework will introduce taxing the cross-border payments made through cryptocurrencies.
Also, under the current jurisdictions, it is not legal for a government to tax a foreign company not having a physical presence in its country. But there’s enough evidence showing company’s exploiting this rule to avoid taxes, using cryptocurrencies.
Apart from introducing new taxation framework, the G20 nations will also work to alleviate issues of terror financing and money-laundering.
Regulatory Measures In Line With FATF Standards
A report from the Saudi Gazette suggests that the G20 regulatory measures for money-laundering and terror-financing will be in line with the FATF standards. Also, FATF – Financial Action Task Force (FATF) is a special body to combat money laundering formed in 1989.
Section 25 of the declaration signed by the forum reads:
“We will regulate crypto-assets for anti-money laundering and countering the financing of terrorism in line with FATF standards, and we will also consider other responses as needed.”
Earlier this year, the FATF also discussed the possibility to introduce binding rules to govern the crypto exchanges.
Crypto Taxation System Implementation by 2020
The G20 members agreed that they would present the first report of the taxation system during the next summit. The next meeting of the G20 members will take place in Osaka, Japan, in June 2019.
The report finalization is likely to take place in 2020 succeeded by the tax implementation in the same year.
The Japanese news publication, Jiji, says that the EU and the UK are pro-regulation. On the other hand, the U.S. and China are a bit skeptical about introducing the international crypto tax.
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