The leading countries in the world also known as the G20 are calling for the taxation of cryptocurrencies. Additionally, they are calling for digital currencies to be regulated with the aim of combatting money laundering and other crimes.
International crypto taxation should be implemented
Reports from multiple news outlets indicate that the G20 group came up with a joint document calling for a taxation system that would cover all cross-border electronic payment services. The Japanese new outlet jiji.com stated that according to the current international regulations, cross-border payment companies that do not have a factory or other base in Japan do not fall under the tax jurisdiction of the country.
However, the leading economies in the world are looking to change that by creating a tax system that would cover cross-border electronic services. The countries present at the meeting held in Buenos Aires, Argentina, this weekend are currently working on the system and it would most likely come to fruition in 2019 when Japan will assume the mantle of leadership of the summit. A final version for the regulation and tax proposal is expected to be ready and implemented by 2020.
G20 looking to regulate cryptocurrencies
The group also decided at the summit that they will regulateand fight its use for money laundering and other criminal activities such as financing terrorism. The regulation would be conducted according to the standards set by the Financial Action Task Force (FATF).
According to section 25 of the declaration signed by member states, the body will work towards regulating. The declaration stated that: “We will regulate -assets for anti-money laundering and countering the financing of terrorism in line with FATF standards, and we will consider other responses as needed.”
The Financial Action Task Force is a body that was set up by the Organization for Economic Co-operation and Development (OECD) with the aim of putting in place policies that would help authorities fight money laundering and the financing of terrorists. Earlier this year, the FATF stated discussing ways to introduce regulations that would check the activities of cryptocurrency exchanges all over the globe. The body is also looking to alter the current rules to ensure that they keep up with the market trends.
The G20 declaration revealed that they would also consider other responses while they vow to continue monitoring the global economy which is rapidly becoming more digitalized. The signed declaration further added that the body would seek for a consensus-based solution that will tackle the impacts of the digitization of the economy on the international tax system with an update in 2019 and a final report in 2020.
Back in July, the released a communique seeking to set and apply anti-money-laundering standards for the cryptocurrency sector by October. The Financial Stability Board (FSB), headed by Mark Carney, Governor of the Bank of England, was tasked with developing a framework that will help them monitor the cryptocurrency sector.
The FSB later released a set of metrics it would make use of in monitoring the crypto space. The Framework published stated that: “The objective of the framework is to identify any emerging financial stability concerns in a timely manner. To this end, it includes risk metrics that are most likely to highlight suck risks, using data from public sources where available.”