China Intensifies Crackdown on Offshore Crypto Trading Amid Tax Enforcement Push

Chinese tax authorities have escalated efforts to clamp down on offshore cryptocurrency trading, targeting individuals who evade taxes on foreign earnings. Six major city tax offices—including Beijing and Shenzhen—issued coordinated statements confirming they identified and coached taxpayers to declare overseas income. Advanced data analytics enabled the tracking of unreported crypto profits.

Xiamen resident Fu faced a 7 million yuan ($983,500) back-tax bill, while Sichuan's Li paid 6.7 million yuan. The campaign mirrors a similar March initiative, reflecting Beijing's urgency to offset dwindling land-sale revenue and local debt constraints. Enforcement leverages the 2018 Common Reporting Standard, a global tax transparency framework.

While Chinese law has long mandated taxes on worldwide income—including crypto gains—enforcement remained lax until 2023. The crackdown now intersects with capital controls, as officials aim to curb tax avoidance and illicit fund flows simultaneously.