Hong Kong vows to finish crypto asset reporting framework by 2026

The Hong Kong government has told the OECD Global Forum that its regulators plan to implement a cryptoasset reporting framework to combat cross-border tax evasion. Regulators plan to complete the necessary regulatory changes before 2026.

At the Organization for Economic Co-operation and Development’s Global Forum on Transparency and Effective Exchange of Information in Tax Matters on December 13, representatives from the Hong Kong government pledged to implement a framework that would make cryptoasset reporting mandatory for tax calculations.

The framework aims to increase global tax transparency and combat cross-border tax evasion, according to a press release shared on the government’s website. Building on existing reporting standards found under the District’s Automated Exchange of Financial Account Information for Tax Matters, the cryptoasset reporting framework requires taxpaying residents to report their crypto accounts and transactions annually.

The government plans to finalize the regulatory framework by 2026 or earlier. Meanwhile, regulators aim to begin implementing the cryptoasset reporting framework with relevant tax jurisdictions by 2028.

The information collected based on the reporting framework will then be shared with tax authorities along with relevant information on crypto assets in different countries to ensure fair and effective global application of the framework.

According to the statement, Hong Kong has automatically shared financial account information with common tax jurisdictions every year since 2018. The relevant tax authorities will then use this information for tax assessments and to detect and combat tax evasion.

Christopher Hui, Hong Kong Minister of Financial Services and Treasury, said the implementation of the crypto-asset reporting framework is in line with Hong Kong’s commitment to promote international tax cooperation efforts and ensure global tax transparency.

“The implementation of the reporting framework is vital to safeguarding Hong Kong’s reputation as an international financial and business centre, and reflects Hong Kong’s reputation as a responsible tax territory,” Hui said.

Additionally, Hui ensured that regulators took into account input from relevant stakeholders and the public when preparing the necessary regulatory changes.

As previously reported by crypto.news, Hong Kong regulators are currently looking at ways to speed up the process of establishing crypto regulations to keep up with the rapidly growing industry.