Ops Token": Malaysia's Coordinated Crackdown on Crypto Tax Evasion
Summary:
The Malaysian Inland Revenue Board (IRB), in collaboration with the Royal Malaysia Police and CyberSecurity Malaysia, undertook a unique initiative, “Ops Token,” to counter tax evasion in the realm of cryptocurrency trading. The purpose of the operation was to target companies that failed to declare their crypto tax liabilities, leading to a substantial tax revenue deficit for the nation. The data acquired from the raid will help identify the extent of tax evasion and, potentially, enhance revenue collection through effective taxation measures. While cryptocurrencies are legal in Malaysia, the country's central bank does not consider them as legal tenders or legit payment instruments, and businesses dealing with such assets must comply with income tax laws.
The Malaysian Inland Revenue Board (IRB), in collaboration with the Royal Malaysia Police and CyberSecurity Malaysia, embarked on a unique operation called “Ops Token” to counterbalance the tax deficit arising from unreported cryptocurrency trading activities. According to reports by The Malaysian Reserve, a special task force of 38 officers raided 10 key locations in Klang Valley. The objective was to bring to book companies which had skimped on reporting their crypto trading activities, thereby exacerbating the country’s tax revenue drain problem. The undertaking lines up with the local government’s aspiration to improve the tax system and curtail tax leakage.
The allegations claim that crypto trading had been carried out under the guise of limited liability partnerships and corporate bodies, which had conveniently omitted declaring their due taxes. Findings from the operation revealed trading data stored in digital gadgets and computers which highlighted significant amounts of digital asset wealth, which when undeclared, resulted in substantial tax revenue leakage.
The data procured from the raid is under review to ascertain the value and resulting profit from the crypto trades. This will assist the IRB in understanding the scope of tax evasion. The spotlight is now on Datuk Abu Tariq Jamaluddin, CEO of the IRB, cautioning individuals involved in crypto trade to adhere to tax compliances and urgent declarations of crypto taxes to ward off punitive actions by the IRB. There is also anticipation that this operation will enhance tax efficiency and plug revenue leakages, contributing to the country’s robust revenue generation.
In the context of cryptocurrency regulations in Malaysia, it is noteworthy that cryptocurrency is a legally approved and regulated investment medium patrolled by the Securities Commission (SC). In Malaysia, tokens are viewed as securities and are subject to the country's statutory laws. Despite its legality, the country's central bank does not count cryptocurrencies or tokens as legal tenders or accredited payment methods. Additionally, businesses dealing with cryptocurrency must abide by the national income tax laws.
Published At
6/17/2024 1:15:57 PM
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