The Spanish Ministry of Finance is looking to expand its ability to seize cryptocurrencies and non-fungible tokens (NFTs) as part of a new tax reform initiative.
According to a report in the Spanish daily newspaper El Economista, the Ministry of Finance in Spain is preparing to introduce a tax reform that would give it the authority to seize digital assets, such as cryptocurrencies and NFTs, in cases where taxes are not paid.
The proposed reforms to the General Tax Law, particularly Article 162, would grant the local tax agency the power to seize cryptocurrencies in the event of a user’s debt. Changes to the General Collection Regulations are also being suggested to allow for the seizure of cryptocurrencies. El Economista mentioned that the ministry already has information on taxpayers’ cryptocurrency holdings and that individuals and companies are now required to declare their crypto assets held abroad.
While the report did not provide a specific timeline for the initiative, Spain has been at the forefront of implementing strict tax regulations on cryptocurrencies in Europe. Taxpayers must report profits or losses related to crypto in their personal income tax filings. Additionally, individuals with crypto holdings exceeding €50,000 are required to declare these assets for wealth tax purposes by March of each year. Those holding crypto assets in self-custodial wallets, such as MetaMask or Ledger, can use Form 714 for declaration purposes.
In a previous report, Spain’s tax regulator issued over 325,000 warnings to residents who failed to report their cryptocurrencies in 2023, a significant increase from the 150,000 warnings issued in 2022.
Overall, Spain is making strides in regulating cryptocurrencies and digital assets, demonstrating a proactive approach to enforcing tax compliance in the crypto space.