The Malaysian government has stepped up efforts to combat cryptocurrency tax evasion, launching a special investigation codenamed “Ops Token,” with Inland Revenue Board (IRB) officials conducting raids in multiple locations targeting companies suspected of not reporting cryptocurrency-related activities.
The crackdown reflects India's efforts to regulate the cryptocurrency industry, aimed at establishing transparency and control over cryptocurrency transactions, which are often anonymous and prone to illegal activities. The IRB is working with the Royal Malaysian Police and Cyber Security Malaysia (CSM) to identify tax evaders. A team of 38 security personnel conducted raids at 10 locations in the Klang Valley.
In Malaysia, cryptocurrencies are classified as securities and are not considered legal tender, but their trading is permitted, and cryptocurrency businesses operating in the country are subject to the country's tax system.
The move comes as Malaysia's crypto market revenue is predicted to reach $306.6 million by the end of 2024, with an estimated 3 million residents actively involved in the crypto industry.
The Malaysian government is determined to curb tax evasion in all sectors. Earlier this year, Prime Minister Anwar Ibrahim instructed authorities to crack down on tax evaders after it was reported that the country had lost RM6.34 billion in tax evasion.
Cryptocurrency-related companies are currently being audited and those found to be in default will be penalized. Tax evasion in Malaysia carries a fine of up to RM20,000 and a prison sentence of up to six months.
The crackdown follows previous measures taken by the Malaysian government to rein in cryptocurrency mining operations that it deemed were a waste of electricity.
