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New Zealand’s tax agency wants crypto firms to hand over client data

The Inland Revenue Department has requested cryptocurrency firms to hand over the personal data of their clients.

Image by Bernd Hildebrandt from Pixabay

Wed, 30 Sep 2020, 07:22 am UTC

The Inland Revenue Department recently requested all cryptocurrency firms in the country to hand over the personal data of their customers. However, the move by New Zealand’s tax agency was met with criticisms from some crypto industry players citing privacy concerns.

New Zealand’s tax agency, the Inland Revenue Department (IRD), issued a request to crypto firms to hand over the personal details of the clients, according to Bitcoin.com. These include the amount of cryptocurrency assets as well as the type of asset held by investors.

“IRD is requesting this information to enhance our understanding of the crypto asset environment in New Zealand so we can work out how best to help taxpayers meet their income tax obligations,” the tax agency said in a statement, RNZ reported.

Some players in the crypto industry expressed disappointment over the agency’s move. However, it is hardly surprising that the IRD is getting more interesting in the digital currency sector, which has become increasingly popular in recent years.

“I guess [IRD] is just widening its net of the tax base and crypto assets are something that is definitely growing in popularity and we're seeing a huge increase in New Zealanders getting involved,” Easy Crypto CEO Janine Grainger said.

IRD’s request to get their hands on customer information drew criticism from some players of the crypto industry. “Privacy is really important to us... one of the tenets [of] cryptocurrency, in general, is around having freedom and autonomy and privacy,” Grainger explained.

“While many people might think 'I have nothing to hide, therefore, what do I care?' the point of privacy isn't to aid people who have something to hide, it's to ensure we have a fair, open and free society,” the Easy Crypto CEO added.

Unfortunately, the country’s crypto firms might not have legal grounds should they plan to refuse the request, according to the report. Just like in the U.S., cryptocurrencies are considered as a form of property in New Zealand and tax is paid with any sale, exchange, trade, and lending activity.

Crypto firms have yet to respond to the IRD’s inquiry. However, taxpayers can make a voluntary disclosure to the tax agency if they are concerned if they have met their obligations.

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