HMRC wants input from professionals, investors, and other organizations involved in DeFi-related activities. The United Kingdom government is seeking public input regarding the taxation and staking of crypto assets loans and staking within the context of Decentralized Finance (DeFi).
DeFi is a general term that describes financial applications built on top blockchain technology. This could be anything, from borrowing to lending and staking platforms.
The government wants to know more about the taxation of crypto assets loans and staking. The call for evidence paper by Her Majesty’s Revenue and Customs (HMRC), was published Tuesday. It described the government’s intention to examine whether there are administrative hurdles and costs that taxpayers can avoid in order to reduce them. Also, it examined whether tax treatment could be more consistent with transactions’ fundamental economics.
HMRC seeks input from professionals, investors, and other organizations involved in DeFi-related activities, such as trade associations and representative bodies and technology and financial service companies, educational institutions, think tanks, legal, accounting, and tax advisory firms. The agency has given interested parties until August 31, 2022 for them to respond via email.
The government will publish the summary of all responses and details about its next steps following the call for evidence.
The government published a list in April of plans to make the United Kingdom into a global crypto powerhouse. John Glen, Economic Secretary, said that one of them was “major surgery on the tax system to make it more easy for crypto.”
The government launched a consultation in May to allow the Bank of England to appoint administrators for managing insolvency arrangements for failing stablecoin issuers.
A former chancellor of Britain expressed concerns about cryptocurrency regulation. According to Cointelegraph, Philip Hammond (the United Kingdom’s chancellor at the Exchequer between 2016 and 2019) stated that there was a lack of direction or cohesion in regards to cryptocurrency policy.
