Hong Kong eyes international info sharing on crypto assets to combat tax fraud, evasion Hong Kong has launched a public consultation regarding a system for sharing information on crypto assets with other governments in compliance with international standards as the city ramps up initiatives to develop as a digital-asset hub. The government has invited members of the public to share views about the implementation of the Crypto-Asset Reporting Framework (CARF) and amendments in relation to the Common Reporting Standard (CRS) put forward by the Organisation for Economic Co-operation and Development (OECD), according to a statement. “To demonstrate our commitment to promoting international tax cooperation and combating cross-border tax evasion, as well as to fulfil our international obligations, Hong Kong will make amendments to the Inland Revenue Ordinance,” said Christopher Hui, secretary for Financial Services and the Treasury, in the statement. The process was of “paramount importance” to maintain Hong Kong’s reputation as an international financial and commercial centre, he added. The consultation paper outlines the OECD’s CARF and amended CRS and sets out in detail the legislative proposals and relevant implementation matters. Members of the public can submit their views until February 6. “The government plans to complete the necessary local legislative amendments in the coming year, with a view to commencing the automatic exchange of tax information on cryptoasset transactions with relevant partner jurisdictions starting from 2028, and implementing the newly amended CRS starting from 2029,” Hui said. “Hong Kong will implement the automatic exchange of tax information with suitable partners, which are required to meet the standards relating to the protection of data confidentiality and security, on a reciprocal basis.” Given the rapid development of digital-asset markets in recent years, the OECD published the CARF in 2023 to provide for the automatic annual exchange of tax information on cryptoasset transactions with partner jurisdictions. It incorporated into the CRS new digital financial products and enhanced requirements regarding reporting and due diligence. Hong Kong has been stepping up its cryptocurrency development efforts, with the Securities and Futures Commission set to allow locally licensed digital-asset exchanges to integrate their order books with those of their affiliated platforms globally, according to Elizabeth Wong, the commission’s director of licensing and head of its fintech unit. Along with the development of the digital-asset sector, the city has also seen a record HK$1.6 billion cryptocurrency fraud in the JPEX cryptocurrency scandal, which victimised more than 2,700 people, according to government prosecutors. Eleven men and four women, aged 25 to 54, were charged with 50 counts of criminal charges, including fraudulently or recklessly inducing others to invest in virtual assets, conspiracy to defraud and money laundering. “Hong Kong has long been supportive of international efforts to enhance tax transparency and combat cross-border tax evasion,” the government’s statement said. “Since 2018, Hong Kong has been exchanging financial account information automatically with partner jurisdictions on an annual basis in accordance with the CRS developed by the OECD, which enables the relevant tax authorities to utilise such information for tax assessments, as well as for detecting and combating tax evasion.” The government also proposed mandatory registration for financial institutions to enhance identification, as well higher penalty levels and enhanced enforcement mechanisms, in order to maintain a favourable rating in the OECD’s peer reviews. https://www.scmp.com/business/article/3335787/hong-kong-eyes-international-info-sharing-crypto-assets-combat-tax-fraud-evasion (ICE HONG KONG)

Fonte notizia: South China Morning Post