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Spain’s tax authorities have given a notice to digital currency investors in the region, outlining the imposition of significant fines for failing to disclose the existence of their assets.
According to local media sources, the Ministerio de Hacienda claimed that digital assets were deemed taxable profits by the government, and that there were significant fines for those who refused to fully declare their holdings.
The move was made by the Spanish authorities at the start of the new tax year, reminding digital currency consumers in the country of their reporting requirements for digital currencies and other sources of revenue.
According to Spanish law, tax is levied on the selling of digital currencies rather than at the point of sales. Local tax attorneys Jess Gascón, Marta Rayaces, and Enrique Garca concluded that this will cover a variety of cases for those in the country who use and trade digital currencies.
“Either because we have changed them to euros, to another cryptocurrency, or because we have used them to buy goods, a flat, or a car.
The warnings come as Spain is in the midst of a new digital currency boom, particularly in Madrid, where over 100 establishments already routinely accept payments in digital currency.
However, the growth in the domestic cryptocurrency sector has been met with strong opposition from regulators and government agencies, intent on enforcing strict regulation of digital currency usage.
The National Securities Market Commission has also proposed tight rules for regulating advertising of digital currency products, as well as publishing a joint statement with the Bank of Spain highlighting the investment risks in an asset class they described as “volatile, complex, and lacking in transparency.”
The new round of tax compliance serves as a further reminder of Spain’s stringent commitment to digital currency control, both for individuals and businesses working in the market.