crypto regulations in Denmark

Danish Tax Agency to Collect Data of Crypto Traders

After the enforcement of strict regulations around cryptocurrencies in Denmark, Skattestyrelsen, the Danish tax agency has now announced its intent to collect data of traders from various cryptocurrency exchanges.

This news comes after Skattestyrelsen received permission from the Danish Tax Council to access the data of crypto exchanges.

Skattestyrelsen will be able to collect data such as customer identity, and history of trading in cryptocurrencies for two years between the time period of 2016 to 2018. Data on customer identification includes customer’s name, address, as well as the CPR number. The CPR number in Denmark is described as the Tax ID number.

As per reports, the tax agency has already discussed the retrieval of the above-mentioned information from at least three digital currency exchanges. If the information is retrieved successfully, then it will be the first time in Denmark that such access to data is granted to a government-led agency.

Karin Bergen, the Director of Personal Income Tax at the national tax agency has highlighted that this move will facilitate better regulation of the crypto markets in Denmark. Bergen said,

“This gives us new opportunities with respect to exerting control in the field.”

Bergen stated that the agency is aware of the large crypto market and the massive data that it may have to sift through. She said.

“..it’s still too early to tell how many traders are out there and how much money has been traded.”

The move by Skattestyrelsen does not come as a surprise. The agency had, in December 2018, started an investigation into thousands of crypto traders who were suspected to have been trading covertly on Finland-based digital currency exchange.

During the investigation, Bergen had warned Danish crypto traders that the agency is cognizant of their unpaid taxes and will be taking appropriate action.

Bitcoin expert Payam Samarghandi seconded Bergen’s statements by declaring that crypto assets are taxable in Denmark.

To conclude, Denmark is continuously reworking its regulations surrounding taxes on cryptocurrencies. In a previous attempt, the Scandinavian nation had sought to bring about rules similar to the ones applied to stock markets. With a survey by the National Tax Board revealing that as much as 10% of Danish citizens prefer shopping in digital currencies, the government has subsequently decided to increase the pace of bringing about proper regulations.