Hong Kong launches CARF crypto tax consultation to combat evasion

Hong Kong has launched a public consultation regarding the implementation of the Organization for Economic Co-operation and Development’s (OECD) Crypto-Asset Reporting Framework (CARF) and revisions to its tax reporting standards. This move is explicitly aimed at combating cross-border tax evasion and standardizing local practices, as Hong Kong has already been exchanging financial account information since 2018. Christopher Hui, Hong Kong’s secretary for financial services and the Treasury, stated that adopting CARF demonstrates the government's commitment to international tax cooperation. Concurrently, Hong Kong is seeking input on adopting the Common Reporting Standard (CRS), another OECD initiative. CARF is gaining widespread international traction, with 76 countries pledging adoption by various dates, though some, like Switzerland, have delayed implementation. Concerns exist that certain structures, such as Cayman Islands foundations holding crypto assets, might be excluded from CARF, potentially offering an avenue for tax avoidance.

(Source：Cointelegraph)