In a historic move, tax officials from Indonesia and Australia met in Jakarta on April 22 to make an agreement public that will set up a strong framework for taxing cryptocurrencies. The deal, which was made public on April 23, is a significant advance toward making it easier to find and tax crypto assets in both countries.
The agreement shows a strong desire to improve cooperation in sharing important information about cryptocurrencies, which will make tax compliance methods more effective. It also shows how important it is for tax officials to work together and come up with new ideas in order to keep up with the fast changes in global financial technologies.
Crypto Tax Pact Strengthening
A director at the Indonesian Directorate General of Taxes (DGT), Mekar Satria Utama, stressed how important it is to change tax policies to suit the growing crypto world while still making sure everyone is taxed fairly. He made it clear that these kinds of steps are needed to boost the economy and pay for important public spending in things like education, healthcare, and infrastructure.
Notably, this partnership builds on work that the tax officials of Australia and Indonesia have already done together. For example, they have digitized taxpayer services and put a value-added tax (VAT) on digital goods and services.
Indonesia has been actively shaping the rules that guide the cryptocurrency sector and forming partnerships with other countries and international organizations to build a strong set of rules. The Financial Services Authority (OJK) of Indonesia has been leading these efforts. It has been working with similar agencies in Malaysia, Singapore, and Dubai to set the stage for Exchange regulation.
As of January 2025, a recent decision says that Exchange companies that want to do business in Indonesia must first go through a regulatory sandbox evaluation. If these entities don’t follow this rule, they will be operating illegally. At the same time, Australia is one of many countries working with the Organization for Economic Cooperation and Development (OECD) to create the Crypto-Asset Reporting Framework (CARF). This framework will make it easier for countries to share information automatically about crypto-assets so that tax rules are the same around the world.
Even though this isn’t a bilateral tax treaty, the goal of this partnership is to make tax processes easier and stop people from not paying their taxes on cryptocurrency earnings on a global level.
