The authorities in Malaysia are said to be cracking down on crypto tax evaders. As part of a special investigation codenamed ‘Ops Token’, officials from the Malaysian federal agency Inland Revenue Board (IRB) reportedly conducted raids at multiple locations having identified firms that were not reporting their crypto-related engagements. Through these taxes, the Malaysian administration much like India, is trying to maintain a trail of crypto-related financial transactions which otherwise are largely anonymous and could be exploited for unlawful activities.
The IRB is said to have joined forces with the Royal Malaysia Police as well as with CyberSecurity Malaysia (CSM) to identify tax evaders. A team of 38 security personnel were part of the team that conducted raids across ten locations situated in the Klang Valley, a report from The Malaysian Reserve said over the weekend.
In Malaysia, cryptocurrencies are said to be categorised as securities. While cryptocurrencies are not considered as payment options, their trading is allowed in Malaysia. Crypto-related businesses functioning in the country however, do fall under the nation’s tax regime.
As per Statista, Malaysia’s cryptocurrency market is projected to reach the valuation of $306.6 million (roughly Rs. 2,556 crore) in revenue by the end of 2024. Statista also estimates that currently three million Malaysian residents are active in the crypto space.
The authorities there are trying to curb cases of tax evasion in the nation overall. In March, the Malaysian Prime Minister Datuk Seri Anwar Ibrahim reportedly instructed the authorities to clampdown on tax evaders.
His direction to conduct audits of crypto-engaged companies and take action against the defaulters came after Malaysia reportedly lost RM 6.34 billion or $1.3 billion (roughly Rs. 11,222 crore) to tax evasion.
In Malaysia, the punishment for evading taxes can be a penalty of up to RM 20,000 0r $4,237.74 (roughly Rs. 3.53 lakh) as well as up to six months in prison.
Previously, Malaysia had cracked down on crypto miners in order to prevent electricity being stolen for mining operations.