Take Cover Aussies – The Tax Man Is Coming

Taxing cryptocurrency owners, or in fact, chasing them around the world has become a thing now. It all started when Spain made the controversial announcement that they were going to start looking for crypto owners in the country, track their trading habits and tax them accordingly.

Although it looks unfair from the surface, it is still within the law. If cryptos are considered as tradable assets than the government is entitled the gains.

What's It All About?

The ATO (Australia Tax Office) just announced that they will start tracking down individual crypto owners and will encourage them to disclose their trading data willingly. Due to the fact that no governmental or central body tracks the trading activities of cryptocurrencies within Australia, the ATO will have to employ the support of local cryptocurrency companies and exchanges.

One Australian cryptocurrency investor has already commented on this new development. According to his opinion, the government will not be able to draw out any trading data from large exchanges like Binance, they'll have to rely on the compliance of the population, as well as local exchanges.

Due to the fact that a very small percentage of Australians actually trade cryptos with local operators, it is very unlikely that the ATO will be able to come up with numbers even remotely close to what it actually traded in the country.

Where Will the Government Look?

As already mentioned, the first places where the government will pay attention to will be local cryptocurrency companies and the traders that willingly disclose their trading data. Getting data from foreign companies is pretty much impossible.

However, one of the most unique places that the ATO may look in, are foreign gambling operators with an Australian license. It may sound shocking, but what's even more shocking is the number of Aussies that participate in gambling every day. Roughly 80% of the population had visited a gambling site in the last year. Gambling sites, which are now starting to offer cryptocurrency payments and gambling sites that have no issue disclosing this information.

Even if the deposit history is not enough, the operators have data about the AU bitcoin gambling options and frequency of participation. Just looking at the statistics will be enough to determine major crypto owners.

This method is usually used by Aussies who try to avoid having gambling transactions on their transaction histories in banks, in order to avoid any damage to their credit score. In fact, these gaming websites may be the perfect place to look for data.

Why Now?

Although the process can be justified as just enforcing the tax laws of the country, it is obvious that this "tax hunt" is connected to the cash transaction limitations coming July 1st.

The Australian government and the ATO want to have more control over the cash outflow from the country, seemingly to manage any illegal financing, money laundering, etc.

Due to the fact that cryptocurrencies cannot be tracked or refunded automatically, virtually every government is facing issues in collecting the data. If the limit is set to $7,500, then everybody still using fiat currencies will be at a disadvantage compared to people using cryptos as their go-to payment methods.

Overall, it's a big power move to regulate the payment industry inside and outside of the country more accurately.