Tax measures that would allow financial institutions to collect taxes on behalf of the government have been unveiled by Spain’s Ministry of Finance.
In order to be able to seize digital assets in order to pay off tax bills, the Spanish Ministry of Finance is seeking to increase the scope of its oversight over cryptocurrency activity in the nation. Reports state that the ministry, under the direction of María Jesús Montero, is working on changes to Article 162 of the General Tax Law that would enable the Spanish Tax Agency to locate and seize cryptocurrency assets that taxpayers with past-due bills own.
The list of companies that can be granted tax collection rights has been expanded by a royal order that went into effect on February 1. Up until recently, the Treasury could only receive reports from banks, savings banks, and credit cooperatives.
The Treasury intends to take a more robust stance against tax evasion. The goal is to compel banks and other electronic money providers to disclose every card transaction.
There are several regulatory problems arising from the rapid pace of change implementation. The nation is making an effort to control cryptocurrency proactively by enacting a number of laws.
Six months ahead of schedule, in October 2023, the Spanish Ministry of Economy and Digital Transformation announced that the Markets in Crypto-Assets Regulation (MiCA), the first comprehensive framework for cryptocurrency in the European Union, will go into effect nationwide in December 2025. Residents of Spain who possess cryptocurrency assets on non-Spanish platforms have till the end of the following month to report them to the relevant tax authorities.
Form 721 declarations must be submitted between January 1, 2024, and March 31st, 2024, at the latest. As of December 31, 2023, taxpayers, both individual and corporate, are required to disclose the amount of money kept in foreign cryptocurrency accounts.
But only those whose bank sheets show more cryptocurrency assets than the equivalent of 50,000 euros, or about $54,000, are required to disclose their international holdings. Individuals who keep their assets in self-custodied wallets are required to report those holdings using Form 714, Standard Wealth Tax.