Tightening of Taxation on Overseas Income in China, Global Implementation of Taxation Transparency CRS 2.0 Accelerates

BlockBeats News, May 20th, according to Caixin, the global tax transparency regime CRS 2.0 is accelerating its global implementation. Cryptographic assets, CBDCs, and some digital currency products have been included in the financial asset declaration scope. Hong Kong, China, plans to implement CRS 2.0 by 2028 and will simultaneously promote the Crypto-Asset Reporting Framework (CARF). In the future, cryptocurrency exchanges, brokers, and cryptocurrency ATM operators will be required to report cryptocurrency-to-fiat currency exchanges, cross-border cryptocurrency swaps, and domestic and overseas cryptocurrency transfers. The reporting must clearly indicate the full name of the assets, such as Bitcoin (BTC), Ethereum (ETH), Tether (USDT), etc., and calculate the total market value, total holdings, and number of transactions by transaction dimension. For retail payment transactions, individual transactions over $50,000 USD will need to be reported separately.

Although the mainland of China has not officially announced the timetable for the implementation of CRS 2.0, since 2025, tax authorities in many regions have been notifying taxpayers to voluntarily declare overseas income for the years 2022 to 2024 through self-inspection via phone calls, text messages, etc., and to pay taxes in accordance with the law. It is reported that CRS 2.0 will not only expose overseas-held cryptocurrency assets entirely to the tax authorities but may also trigger collaborative investigations by other regulatory agencies.