Hong Kong Begins Public Consultation on Crypto Tax Reporting Rules

Hong Kong has launched a public consultation on implementing the OECD's Crypto-Asset Reporting Framework (CARF) and an updated Common Reporting Standard (CRS), aiming to bring cryptocurrency transactions under the same tax transparency regime as traditional financial accounts. The move targets cross-border tax evasion through digital assets.

Crypto exchanges, brokers, and wallet providers will be required to annually report user data and transaction details to tax authorities. The framework specifically covers emerging digital financial products including crypto derivatives and tokenized investments, acknowledging their comparable tax risks to conventional instruments.

The automatic exchange of information with partner jurisdictions will commence in 2028, with the updated CRS taking effect in 2029 on a reciprocal basis. Hong Kong has participated in financial data sharing under CRS since 2018, but this marks its first systematic approach to cryptocurrency taxation.