Government Initiates Public Consultation for Crypto-Asset Reporting Framework
The Hong Kong government has initiated a public consultation process to implement the OECD’s Crypto-Asset Reporting Framework (CARF) and revised Common Reporting Standard (CRS). The government plans to fully integrate this framework by 2028 to facilitate the automatic exchange of tax information on crypto transactions.
The automatic exchange of information is set to begin in 2028, while the new CRS will be implemented in 2029. This development marks a significant step toward increasing tax transparency and aligning with international standards for crypto transactions.
"To demonstrate our commitment to promoting international tax co-operation and combating cross-border tax evasion, as well as to fulfil our international obligations, Hong Kong will make amendments to the Inland Revenue Ordinance (Cap. 112) (the Ordinance) for implementing CARF and the newly amended CRS. This is also of paramount importance in maintaining Hong Kong's reputation as an international financial and commercial centre." — Christopher Hui Ching‑yu, Secretary for Financial Services and the Treasury of the HKSAR Government
Historical Context: 2018 Reforms Paved the Way for Crypto Regulation
In 2018, Hong Kong began exchanging financial account information based on OECD standards, a precursor to its current move to include crypto-assets in automatic tax reporting.
Bitcoin (BTC) currently trades at $90,511.59, with a market cap of $1.81 trillion. Its 24-hour trading volume is $57.27 billion, showing a 5.53% change. Recent price movements indicate a 1.11% decline over the past day but an overall 4.00% increase over seven days.
Insights from the Coincu research team suggest potential regulatory challenges and technological advancements as the framework is integrated. Hong Kong's move may drive greater innovation in compliance technologies and require businesses to adapt rapidly to new tax reporting obligations.