Australia’s tax office is reportedly requesting personal data and transaction details from up to 1.2 million users of cryptocurrency exchanges in order to crack down on tax obligations related to crypto trading. The Australian Taxation Office (ATO) stated that this data will help identify traders who have failed to pay taxes on their crypto trades. The ATO will be seeking information such as users’ date of birth, social media accounts, phone numbers, wallet addresses, type of coins traded, and bank account details. Cryptocurrencies are considered taxable assets in Australia, requiring traders to pay capital gains tax on profits from the sale of crypto assets.
This tax collection crackdown comes at a time when crypto investors are experiencing significant profits. Bitcoin (BTC) has rallied over 44% since the start of the year, while Ether (ETH) has risen 32% year-to-date. The market capitalization of top altcoins, excluding Bitcoin and Ether, has also increased by more than 27% this year.
The ATO’s notice highlights the complex nature of cryptocurrencies, which often leads to a lack of awareness regarding tax obligations. Australia is not the only jurisdiction seeking to collect unpaid taxes on digital asset gains. Canada’s tax agency, the Canada Revenue Agency (CRA), is conducting over 400 crypto-related audits and investigating hundreds of investors to secure unpaid crypto taxes. In Turkey, the government plans to introduce legislation on crypto taxes later this year, while in the United States, regulators are proposing to raise the long-term capital gains tax rate for high-earning investors.
Overall, global regulators are taking steps to ensure that individuals pay their taxes on cryptocurrency gains, reflecting the increasing importance of cryptocurrencies in the financial landscape.