The Spanish Ministry of Finance is seeking to expand its control over the monitoring of crypto in the country in an effort that would allow it to seize the digital assets to settle tax debts.
The ministry is developing legislative reforms to the General Tax Law, specifically Article 162, to allow the Spanish Tax Agency to identify and take over crypto assets owned by taxpayers who maintain overdue debts, according to reports.
A royal decree, which came into force on Feb.1, expands the number of entities to be given tax collection powers. Until now, only banks, savings banks and credit cooperatives can report to the Treasury.
The Treasury is also planning to fight tax evasion more aggressively. It is looking to force banks and electronic money institutions to report on all card transactions. The speed at which the changes are being implemented poses some challenges on the regulatory front. The country is trying to move proactively with various regulations to govern crypto.
In October, the Spanish Ministry of Economy and Digital Transformation reported that the first comprehensive European Union crypto framework, the Markets in Crypto-Assets Regulation (MiCA), will come into force nationally in December 2025, six months before the official deadline.
Spanish residents holding any crypto assets on non-Spanish platforms have until the end of next month to declare them to the tax authorities.
The submission period for a Form 721 declaration started on Jan.1, 2024, and ends on the last day of March. Individual and corporate taxpayers must declare the amount of funds stored in their crypto accounts abroad as of Dec. 31, 2023.
However, only individuals with balance sheets exceeding the equivalent of 50,000 euros in crypto assets are obliged to declare their foreign holdings. Those who store their assets in self-custodied wallets must report their holdings through the standard wealth tax form 714.
