Coin Edition -
- Malaysia’s Inland Revenue Board (IRB) partnered with law enforcement to investigate tax revenue leakage from crypto transactions.
- The IRB uncovered significant undeclared cryptocurrency trading data.
- The IRB urges crypto traders to declare taxes to avoid legal action.
Malaysian authorities have launched a crackdown on cryptocurrency-related tax evasion, conducting a nationwide operation to uncover undeclared income from digital asset transactions.
The security sweep, code-named Ops Token, involved 38 personnel from the Royal Malaysia Police and Cybersecurity Malaysia (CSM), who simultaneously investigated 10 locations in the Klang Valley.
In a recent press release, the IRB stated:
Through the operation, cryptocurrency trading data stored in mobile devices and computers were found, and we successfully identified the value of digital assets being traded, which caused a very significant leakage of tax revenue.”
The agency added that the seized data will be analyzed to determine the value of the cryptocurrency assets traded and profits generated from the activity, thus identifying the true value of tax leakage that was never declared to the IRB.
“The data obtained will be analyzed in detail to obtain the value of the cryptocurrency assets traded and profits generated from the activity, thus identifying the true value of tax leakage that was never declared to the IRB.”
The operation uncovered several companies and limited liability partnerships that were established specifically for crypto transactions to evade taxes.
Meanwhile, IRB chief executive officer Datuk Dr. Abu Tariq Jamaluddin reiterated that cryptocurrency trading in Malaysia is subject to taxes. He urged individuals engaging in cryptocurrency trading to promptly declare their tax at an IRB office to avoid enforcement action.
The agency believes this operation will increase the country’s revenue and tax efficiency, improving the country’s tax pool by reducing leakages.
In Malaysia, cryptocurrency is legal and regulated by the Securities Commission (SC), the country’s capital markets regulator. Digital assets are considered securities and are thus subject to securities laws.
However, the central bank does not recognize cryptocurrencies or tokens as legal tender or payment instruments. Additionally, businesses focused on cryptocurrency must comply with the country’s income tax laws.
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