Canada Schemes to Launch Audits Against Bitcoin Tax Evaders

Canada Schemes to Launch Audits Against Bitcoin Tax Evaders

The Canada Revenue Agency (CRA) is reportedly targeting Bitcoin investors as well as other cryptocurrency users with federal tax audits.

The CRA has also sent questionnaires to determine the previous trading and investing activity. Taxation of cryptocurrency has been a gray area for years, with tax attorneys and even regulators unsure of how to proceed.

With many investors using KYC-enabled exchanges which store ID and trading history, it’s likely that the audits will uncover all past trading activity in some cases.

CRA Project Oversight Director Jared Adams took to Twitter to comment on the use case of Bitcoin as a vehicle money laundering vehicle.

To his 300-odd followers, the CRA director retweeted a post made by Francis Pouliot, the CEO of Canadian crypto firm Bull Bitcoin. Pouliot’s post, which was tweeted to tens of thousands of supporters, described the process of cashing bitcoins into Canadian dollars “without using a bank account, P2P platform, or Bitcoin ATM”.

CRA director Adams stated that he was taking note of the comment, and added another tweet saying “washingmachine.gif.” The director seemed to be attempting to draw on internet humor to sarcastically make a reference to money laundering, although shirked away from debating the prominent CEO when called out on it.

Pouliot stood his ground and challenged the CRA directors efforts at accusing him of money laundering through a meme, stating the fact that hundreds of Canadians have been denied basic banking services simply for legally using Bitcoin. He asserted that his tweet was aimed as advice for such people.

Like hundreds (known cases) of Canadians citizens and companies, I have had essential financial services like banking, payments and credit cards restricted and accounts closed because of my usage of Bitcoin.

Pouliot pointed out that the Canadian Senate had been notified of the problem, something which Adams refused to discuss. He also refused to clarify his comments regarding money laundering or engage the Bitcoin CEO in an actual conversation regarding regulation or the issue of Canadians being forced to choose between cryptocurrency and basic banking services.

The situation is reminiscent of that in India where banks are forcing users to promise not to use crypto or lose their account.
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