Crypto Tax Regulation in Australia; New Tax Guidelines Incoming
Australian Crypto Taxation
Modified Date:- Published Date:-Categories: Cryptocurrency
Crypto TaxRegulation in Australia; New Tax Guidelines Incoming
The numberof people investing in cryptocurrencies is growing globally. According to astudy by Roy Morgan, over one million people in Australia own cryptocurrencybased on data from December 2021 to February 2022.
TheAustralian Taxation Office Speaks Out
Althoughcryptocurrencies first emerged in 2009, it took the Australian Taxation Office(ATO) over two years to issue guidance on how they should be treated in thecountry. In 2014, the ATO labeled Bitcoin as a “capital gains” assetinstead of a foreign currency.
LicensingRequirements
The comingregulations will introduce new tax measures and guidelines for the operationsof exchange platforms and crypto brokers. They will also help protect theinvestors’ funds.
According toTreasurer Josh Frydenberg, the country’s move to impose strict taxes on alltypes of transactions in the cryptocurrency industry is necessary to keep upwith the sector’s rapid growth. He noted that Australia is becoming aleader in developing this technology and that the country’s regulatory andtaxation systems are needed to support the industry.
One ofthe documents released by the government consults with the crypto industry onthe licensing or rules regarding the custody of virtual goods. In addition, this has connectionsto the treasury’s plan to require crypto exchanges to keep Australianinvestors’ funds within their borders.
Steppingin to Protect Investors
Thegovernment also intends to establish regulations that will help ensure that theservices offered by crypto providers are reliable. Due to the volatility ofcryptocurrencies, the government cannot protect Australian users from theeffects of these transactions. However, it hopes that by establishingregulations, the government can help the industry expand and create trustbetween customers and suppliers.
“TokenMapping”
According toJim Chalmers, the Australian Labor Party (ALP), the government plans toimplement a “token mapping” strategy to govern the industry bythe end of 2022. This new strategy aims to establish a framework for regulatingthe cryptocurrency industry in Australia. Chalmers noted that the governmentwould use the strategy as a starting point for future regulations.
PrimeMinister Anthony Albanese also confirmed the development. He noted that thegovernment aims to establish a balance in the large and relatively unregulatedcryptocurrencies industry.
The popularity of this industry is growing. In Australia, the number of people who invested in cryptocurrencies reached over one million by December 2021. The government will soon introduce new tax guidelines to protect unskilled investors from losing their money and wasting resources.