Malaysia busts crypto tax fraudsters with Ops Token
Malaysia's Inland Revenue Board (IRB) has launched a special operation called “Ops Token” to reduce tax revenue generated from crypto transactions.
According to local media Malaysia Reserve, 38 personnel from the Royal Malaysia Police and Cyber Security Malaysia (CSM) raided 10 different locations in the Klang Valley.
Crypto targets companies that don't properly report their business activities to federal agencies. The initiative is in line with the local government's desire to reduce the flow of tax revenue and improve the country's tax administration.
Malaysian police found evidence of tax evasion
Officials said certain limited liability partnerships and corporate entities have been created for crypto trading. The federal agency believes that these entities have avoided declaring their taxes. The IRB said:
“During the operation, cryptocurrency trading data stored in mobile devices and computers were found and we successfully identified transactions of digital assets that resulted in significant loss of tax revenue.”
The IRB also said that the data obtained during the operation will be analyzed to determine the trading of crypto assets and the profits made. This will help the federal agency identify the value of tax flows that have not been properly reported to the IRB.
IRB chief warns crypto traders to declare tax
IRB CEO Datuk Abu Tariq Jamaldin explained that individuals involved in crypto trading in the country are subject to the Malaysian Income Tax Act. The official warned crypto traders to report their crypto tax to the nearest IRB offices as soon as possible before the IRB takes compliance action.
The IRB expects the operation to increase Malaysia's tax revenue by increasing tax efficiency and reducing tax evasion. The agency believes that it will contribute to the sustainability of the country's revenue collection.
Related: Microsoft pours 2.2B into Malaysia for cloud, AI expansion
Crypto regulations in Malaysia
In Malaysia, cryptocurrency is legal and regulated by the Securities Commission, which is responsible for regulating capital markets in the country. Tokens are considered securities in the country, subject to the security laws.
The country's central bank does not consider crypto or tokens as payment instruments or legal tender. Additionally, crypto-based businesses are subject to the country's income tax laws.
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