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Hong Kong Targets Crypto Tax Evasion with 2028 Data Sharing Plan

Hong Kong Crypto Tax and Data Sharing - Image of Christopher Hui

Hong Kong launched a public consultation on implementing the OECD’s Crypto-Asset Reporting Framework (CARF) and amended Common Reporting Standard (CRS), aiming to start computerized change of crypto tax info with companion jurisdictions by 2028.

The authorities plans to finish legislative amendments in 2026, strengthening the town’s dedication to worldwide tax cooperation whereas sustaining its popularity as a world monetary hub amid evolving digital asset laws.

Financial Services Secretary Christopher Hui introduced “Hong Kong will make amendments to the Inland Revenue Ordinance (Cap. 112) (the Ordinance) for implementing CARF and the newly amended CRS” and demonstrated a dedication to combating cross-border tax evasion.

The computerized change will function on a reciprocal foundation with companions assembly information confidentiality and safety requirements, with the newly amended CRS implementation scheduled for 2029.

Hong Kong Crypto Tax and Data Sharing - Image of Christopher Hui
Secretary for Financial Services and the Treasury Christopher Hui. | Source: The Standard

Framework Responds to Rapid Digital Asset Growth

The OECD printed CARF in 2023 following the fast growth of the digital asset market in recent times, offering computerized change of crypto transaction tax info much like Hong Kong’s present CRS framework, operational since 2018.

The new framework integrated digital monetary merchandise and enhanced reporting necessities, addressing gaps in conventional monetary account info change.

Hong Kong has been exchanging monetary account info mechanically with companion jurisdictions yearly since 2018 beneath the CRS, enabling tax authorities to make use of the data for assessments and to detect tax evasion.

The CARF extension builds upon this established infrastructure, making use of related transparency requirements to crypto property that course of billions in buying and selling quantity throughout the town’s licensed exchanges.

The authorities proposes obligatory registration for monetary establishments to boost identification, alongside elevated penalties and enhanced enforcement mechanisms.

These measures reply to the OECD’s second-round peer overview of Hong Kong’s CRS administrative framework effectiveness, which started in 2024 and examines the town’s dedication to world tax transparency requirements.

Balancing Innovation and Compliance Pressures

The session arrives as Hong Kong navigates competing pressures between fostering digital asset innovation and satisfying worldwide regulatory requirements.

The city has pursued aggressive fintech expansion by way of its new “Fintech 2030” technique launched by the Hong Kong Monetary Authority, specializing in information, synthetic intelligence, resilience, and tokenization beneath the DART framework.

Hong Kong has courted crypto exercise by way of licensing regimes and spot crypto exchange-traded funds, searching for regulated venues for demand.

Securities and Futures Commission Chief Executive Julia Leung lately introduced licensed crypto exchanges will soon connect with global order books, ending the town’s remoted buying and selling mannequin and enabling native platforms to faucet broader liquidity.

Despite regulatory openness, authorities have drawn vivid strains between market infrastructure and listed issuers counting on speculative token holdings.

The inventory change questioned at the very least 5 corporations searching for to pivot to crypto treasury fashions, whereas the SFC warned retail traders about dangers tied to digital asset treasury methods after observing substantial premiums above asset holdings.

Amidst all these, HashKey Holdings advanced toward becoming Hong Kong’s first listed crypto exchange, clearing the inventory change’s itemizing listening to and getting ready to raise at least $200 million through an initial public offering scheduled earlier than year-end.

The firm accounts for greater than 75% of Hong Kong’s onshore digital asset buying and selling quantity and has recorded HK$1.3 trillion in cumulative spot-market transactions.

Mainland Tensions Shape Regional Strategy

The session additionally unfolds towards mainland China’s renewed crypto crackdown, with the People’s Bank of China reasserting strict prohibitions on virtual asset trading in late November following indicators of renewed hypothesis.

Beijing particularly flagged stablecoins as posing cash laundering and fraud dangers, convening a high-level assembly with 13 authorities companies to coordinate enforcement.

Hong Kong-listed crypto corporations noticed sharp losses following Beijing’s announcement, with Yunfeng Financial Group dropping over 10% and OSL Group shedding greater than 5%.

The mainland stance has sophisticated Hong Kong’s ambitions, significantly after Chinese regulators instructed main tech companies, together with Ant Group and JD.com, to pause stablecoin issuance plans.

For now, relating to the session paper, public suggestions is welcome by way of February 6, 2026, with submissions accepted by put up or e mail to the Financial Services and Treasury Bureau.

The put up Hong Kong Targets Crypto Tax Evasion with 2028 Data Sharing Plan appeared first on Cryptonews.

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