The Biden administration has proposed the mandatory collection of investor’s data actively investing in the cryptocurrency markets in the US in an effort to catch cryptocurrency tax evaders.
Biden’s Fiscal Year 2022 Revenue Proposal is aiming to reinforce existing information reporting rules and the sharing of information between jurisdictions.
The Treasury Department released its “Greenbook” revenue proposals last Friday to serve as guidelines requiring cryptocurrency brokers like exchanges and hosted wallet providers to provide information on foreign individuals having accounts with them to the Internal Revenue Service (IRS).
The US could then provide this information to a foreign government and receive information, in exchange, on any U.S. individuals concealing cryptocurrency assets on offshore accounts or wallet providers and dodging their U.S. tax liabilities.
“The global nature of the crypto market offers opportunities for U.S. taxpayers to conceal assets and taxable income by using offshore crypto exchanges and wallet providers,” stated the Greenbook proposal.
Cryptocurrency exchanges Coinbase and Kraken didn’t respond to a request for comment regarding the proposal.
The Blockchain Association, whose members will be subjected to the requirement, declined to comment on the issue.
The proposal is part of President Joe Biden’s administration campaign to strengthen tax enforcement and help pay for trillions of dollars of proposed longer-term spending programs.