The Australian Taxation Office (ATO) may soon crack down on major tax avoidance schemes using cryptocurrencies.
According to a report from The Sydney Morning Herald on Thursday, the ATO is working on 12 tax avoidance cases involving abuse of crypto assets. Notably, the agency's deputy commissioner, Will Day, said at least one of the cases involve a "global financial institution," which is suspected of hiding assets and income details of taxpayers.
The ATO's crackdown is part of a global investigation by tax authorities from five countries, including Australia, the U.S., the U.K., the Netherlands and Canada. These agencies, known as the "J5," are pursuing a further 50 similar investigations globally.
The agencies came together last year to form a collective response against growing tax avoidance, cybercrime, and cryptocurrency abuse, according to the report, and have been sharing international data to pursue tax evaders.
Day cited evidence as showing that individuals in Australia have been enabling tax avoidance or teaming up with people in other countries to conduct criminal activities.
"At no other time have criminals been at greater risk of being caught. In Australia, they are often intermediaries who are playing a role between the tax evader and an offshore entity," he said.
Last month, authorities in the Netherlands shut down a cryptocurrency "mixer," which was used to obfuscate the source of cryptocurrency transactions.
Europol, which was involved in the action, alleged that much of the money that passed through Bestmixer.io “had a criminal origin or destination,” contending that “in these cases, the mixer was probably used to conceal and launder criminal flows of money.”
According to The Herald, information from Bestmixer is being examine and shared between J5 members
Australian tax form image via Shutterstock
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.