Indonesia and Australia Cooperate on Crypto Taxation
Indonesia and Australia Cooperate on Crypto Taxation
The Directorate General of Taxes (DJP) of Indonesia and the Australian Tax Office (ATO) have signed a Memorandum of Understanding for the regulation of crypto information exchange on April 22 at the Australian Embassy in Jakarta.
In their official release, this cooperation encompasses the exchange of information to enhance the detection of assets that may have tax obligations in either country. This means tax authorities can better share data and information related to crypto assets, as well as exchange knowledge to ensure compliance with tax obligations.
"Although crypto assets are relatively new, the need to ensure fair taxation remains important to drive economic growth and provide revenue for crucial public investments in various sectors such as infrastructure, education, and healthcare," said Mekar Satria Utama, Director of International Taxation at DJP.
Belinda Darling, Assistant Commissioner of ATO, emphasized that the arrangement is based on the strong relationship between DJP and ATO.
"The partnership between DJP and ATO has been ongoing for almost two decades and is now focused on strengthening the tax systems in both countries and enhancing our collaboration in addressing complex global challenges," she said.
ATO and DJP have collaborated on various DJP priorities, including the modernization and digitalization of taxpayer services through the establishment of virtual tax assistants, and the implementation of value-added tax on digital goods and services. ATO and DJP continue to partner with DJP on international taxation and broader reforms.
Crypto Tax Rules in Indonesia and Australia
Indonesia and Australia are two countries that have implemented taxes on crypto assets. In Indonesia, crypto is subject to income tax for registered tax-paying crypto asset sellers, which must be paid at a rate of 0.1% of the transaction value, while VAT is 0.11% of the transaction value, specifically for transactions on registered crypto exchanges. Meanwhile, unregistered exchanges are subject to higher tax rates, with income tax at 0.2% and VAT at 0.22%.
Meanwhile, in Australia, crypto is taxed based on the capital gains tax system, which is determined by subtracting the cost base (including transaction costs) from the sale price of the crypto.
If holding crypto for more than 12 months before selling, a 50% tax discount may be obtained. Capital gains are added to ordinary income and taxed based on marginal tax rates.
Conclusion
the collaboration between the Directorate General of Taxes (DJP) of Indonesia and the Australian Tax Office (ATO) marks a significant step forward in the regulation of crypto taxation.
By signing the Memorandum of Understanding, both countries have committed to enhancing the exchange of information to ensure the proper taxation of crypto assets. This partnership reflects a recognition of the importance of fair taxation in driving economic growth and funding essential public investments. Moreover, it underscores the strong relationship between DJP and ATO, built over nearly two decades of collaboration.
Moving forward, this cooperation will not only strengthen the tax systems in both countries but also contribute to addressing complex global challenges. With clear tax rules in place for crypto assets in Indonesia and Australia, taxpayers can navigate the regulatory landscape more effectively, promoting compliance and transparency in the crypto market.
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