Hong Kong industry calls for looser crypto tax reporting rules, citing CARF compliance burden
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Summary
- The Hong Kong Securities and Futures Professionals Association said it broadly supports adopting CARF but that some provisions should be eased.
- The association said the current draft would unduly increase the compliance burden, and stressed that safeguards are needed on administrative fines and provisions on directors’ personal liability.
- The outlet said the debate dovetails with Hong Kong’s policy push to establish itself as a regulated crypto-asset hub.
A Hong Kong financial industry group said it broadly supports adopting the OECD’s Crypto-Asset Reporting Framework (CARF) for crypto tax reporting, but argues that certain provisions need to be eased.
According to crypto industry outlet Cointelegraph on the 19th, the Hong Kong Securities and Futures Professionals Association (HKSFPA) asked the Hong Kong government to make selective adjustments to parts of the CARF and related amendments to the Common Reporting Standard (CRS). The association warned that the current draft could raise compliance burdens excessively.
CARF is an international tax reporting regime designed to enable the automatic exchange of cross-border crypto-asset transaction information. Hong Kong is one of 76 jurisdictions that have agreed to adopt CARF and is set to take part in the first data exchange from 2028.
While HKSFPA said it agrees with the direction of registering crypto-asset service providers and expanding transaction reporting, it called for regulatory relief for businesses with no reportable transactions, stronger personal data protection, and more flexible transfer of records management when a business winds down. It stressed in particular that clear safeguards are needed regarding uncapped administrative fines per account and provisions that impose personal liability on directors.
The outlet said the discussion aligns with Hong Kong’s policy drive to position itself as a regulated crypto-asset hub.
