- New Zealand Implements OECD Crypto Reporting Rules to Enhance Tax Compliance.
- Non-compliance penalties include fines up to $6,200 for providers and $621 for users.
On August 26, 2024, New Zealand’s Minister of Revenue, Simon Watts, proposed a significant legislation amendment to improve transparency in cryptocurrency transactions. The “Taxation Annual Rates for 2024-25, Emergency Response, and Remedial Measures” Bill, which includes the OECD’s Crypto-Asset Reporting Framework (CARF) and changes to the Common Reporting Standard, is expected to go into effect on April 1, 2026.
Crypto Reporting Rules to Facilitate Tax Compliance
The newly released rules require New Zealand-based crypto service providers to collect transaction data on their users. These suppliers must provide the obtained data to Inland Revenue by June 30, 2027. Inland Revenue will subsequently share this information with international tax authorities by September 30, 2027, to ensure accurate monitoring of crypto-asset revenue.
Non-compliance penalties include a punishment of 300 NZD (roughly $186) for each instance for service providers, with a maximum of 10,000 NZD ($6,200). Users who fail to supply the required information may face fines of up to $1,000 NZD ($621).
In an associated move, the Reserve Bank of New Zealand is considering the implementation of a Central Bank Digital Currency (CBDC). A recently published consultation paper seeks public and expert opinion on the potential benefits and challenges of a CBDC. This digital money would be a secure and private digital representation of New Zealand’s official currency, issued directly by the central bank. The Reserve Bank is looking into how a CBDC could boost financial inclusion, the payments system, and monetary policy.
The proposal matches up with New Zealand’s broader initiatives to tighten crypto rules and fix compliance issues specific to digital assets. Earlier this year, Minister of Commerce and Consumer Affairs Andrew Bayly urged for a significant revamp of the country’s digital asset regulations. The tax administration has also increased its scrutiny of unregistered crypto revenues in recent months.
