According to recent reports in the local media, the UK Government has it’s moving to introduce a new reform. The reform, if implemented, will inevitably authorize the government to seize crypto assets from owners and investors. This, according to them, manifested itself in the fight against money laundering and tax evasion in the country. The reforms also include another economic crime law that requires the registration of overseas entities, requiring foreign company owners to reveal their identities. This will help prevent criminals from concealing funds behind fake companies. Without hesitation, the strong implications of the proposed reforms in the UK will certainly have a significant impact on the industry.
The motive behind the UK has proposed reforms and a bill to seize crypto assets
The UK government plans to implement a law that will give it the power to seize crypto assets. The law sought to address the use of virtual assets for tax evasion and money laundering.
In addition, ministers are working on a White Paper that will present the law to the House of Companies and the UK Register. The law will make it obligatory for business owners to submit their financial summaries. It will also impose stricter procedures for emerging companies regarding the identity of their owners.
The above seems to have revived by £ 1.4 cheat case. HMRC seized crypto assets worth £ 5,000 and other NFT works of art whose value is unknown. The procedure set a record for the UK as the first country to seize crypto assets. Nick Sharp, deputy director of HMRC, revealed that the confiscation is a warning to anyone intending to use cryptocurrencies for tax evasion.
Tax evasion and existing laws attached
Without any delay, tax avoidance manifests itself during the manipulation of financial records and the refusal to pay taxes to HMRC. A tax invasion in the UK is a serious offense and could provoke the full anger of the defaulting law. The offense can amount to £ 5,000, jail time and fines. Other penalties include freezing assets, confiscating government assets, legal tariffs and damaging reputations.
Examining the implications of the reforms proposed by the UK
Consequently, the existence of seized property of anyone or companies intending to evade tax is present in the legal framework of the United Kingdom. Therefore, the phenomenon of confiscation of crypto assets under the allegation of tax evasion should be investigated. The law will authorize the government to seize crypto assets even if the case is not related to tax evasion. The general goal of the proposed law is to enable the UK government to fully extort money from investors. Crypto regulation is strict in the UK, cryptocurrencies and assets are classified as property. The Bank of England at the time stated that crypto is not money because it does not affect the banking ecosystem. Strict warning is attached to the use of crypto assets in the country. However, the Tax rate for cryptocurrencies in the UK is relatively strict, as investors pay between 0% – 45% on each return of cryptocurrencies.
Implications of the harsh crypto atmosphere in the UK
Accordingly, the result of this difficult atmosphere in the UK is largely reflected in the ownership of cryptocurrencies and other digital assets in the UK. According to reports, less than 5% of the UK population owns or invests in cryptocurrencies. This number, however, sums up or is equivalent to 3.3 million people, which is relatively low compared to nations that have to promote crypto in their domain. The UK government appears to be trying to force crypto-investment to survive. The government had little or no positive support for the industry. Something really needs to change in order to encourage investors to digital trends very quickly!
The increasingly sharp attitude of the British government towards cryptocurrency will consequently reduce the growth of the industry. However, the inevitable truth that is obviously unknown to government officials, especially in the UK, remains the fact that the cryptocurrency has remained and will continue to grow despite all prospects. Given that, use cryptocurrencies as a technique for tax evasion, it is condemned and should be discouraged en masse. Regardless of the prevailing indications, nothing justifies the introduction of a law that strengthens the seizure of crypto assets.