320,000 Tax Notices Sent As Unreported Crypto Taxes Surges 40%

While the global crypto market is beginning to become saturated, some have started to sneak their way out of reporting their taxes. However, according to the latest report, the Spanish tax authority wants to fish out these individuals by sending out notices.

On April 11, local media outlet El Mundo reported that the Spanish tax agency will send out 328,000 notices to individuals who owe taxes on their cryptocurrency holdings for the 2022 fiscal year.

Unreported Crypto Taxes Surges 40% In A Year

According to the report, these pending notices set to be dispatched represent a 40% increase from the 150,000 notices sent out in the previous year, and a significant jump from the 15,000 notifications issued the year before that.

Although the focus has been on cryptocurrency, the agency will also send out notices for other tax-related issues. Thousands of notices higher than that dispatched to crypto holders will be sent out.

For instance, this year alone, over 660,000 notices will be sent out to those who underreported their rental income, while over 807,000 will be sent out to individuals earning income from abroad.

Notably, the notices set to be dispatched are seen as voluntary invitations to pay taxes on profits gained from selling crypto holdings. This range from 19% to 23%. However, failure to pay taxes on time will result in a 26% fine, calculated based on the amount of funds yet to be paid.

Spain’s Stance On Crypto

While some countries are still far away from leveraging the potential of crypto, Spain is one the countries that have embraced crypto in a notable manner. According to the National Securities Market Commission (CNMV), nearly 7% of Spain’s population holds cryptocurrencies.

The majority of the holders’ age which ranges from 35 and 44 either has a higher stable income or a higher education that earns them at least more than €3,000 (around $3,300) in a month. In addition, Spain claims 3rd position in crypto ATM growth with over 200 installed ATMs

The AEAT’s decision to increase its efforts to collect taxes from cryptocurrency holders comes amid a surge in the use of cryptocurrencies worldwide. Governments and financial regulators are paying closer attention to the crypto sector.

Some countries have been making effort to crack down on the industry, while others are taking steps to regulate it more closely. Spain has shown an interest in blockchain technology, with the country’s central bank approving a euro-linked token pilot as part of its sandbox initiative.

As the use of cryptocurrencies continues to grow, it is expected that more regulatory actions will be taken by governments worldwide to ensure that the sector is appropriately taxed and regulated.

Global crypto market capitalization on the 1-day chart. | Source: TOTAL on TradingView.com

Regardless of the different news circulating in the industry, the global crypto market has maintained composure. Over the past 24 hours, the global crypto market capitalization has declined by only 0.4%, at the time of writing with a value nearing $1.3 trillion.

Featured image from Shutterstock, Chart from TradingView