Spain’s Ministry of Finance has unveiled tax reforms granting financial institutions the authority to collect taxes on behalf of the government. Additionally, the ministry, led by María Jesús Montero, aims to bolster its oversight of cryptocurrencies, enabling the seizure of digital assets to settle tax liabilities.
Reports indicate that the ministry is drafting legislative amendments to Article 162 of the General Tax Law, empowering the Spanish Tax Agency to identify and confiscate crypto assets belonging to taxpayers with outstanding debts.
A recent royal decree, effective as of February 1st, broadens the scope of entities authorized to collect taxes. Previously limited to banks, savings banks, and credit cooperatives, now additional entities will report to the Treasury.
In an effort to combat tax evasion, the Treasury plans to compel banks and electronic money institutions to report all card transactions. However, the rapid implementation of these changes presents regulatory challenges as the country proactively navigates various crypto regulations.
Notably, in October 2023, the Spanish Ministry of Economy and Digital Transformation announced the forthcoming adoption of the Markets in Crypto-Assets Regulation (MiCA), the first comprehensive EU crypto framework. Expected to be enforced nationally by December 2025, six months ahead of the official deadline.
Spanish residents holding crypto assets on non-Spanish platforms must declare them to tax authorities by the end of next month. The submission period for Form 721 declaration began on January 1st, 2024, and concludes on March’s final day. Individuals and corporations must disclose funds stored in overseas crypto accounts as of December 31st, 2023.
However, only individuals with crypto holdings exceeding the equivalent of €50,000 (approximately $54,000) are mandated to declare foreign assets. Those utilizing self-custodied wallets must report holdings through the standard wealth tax Form 714.
