Spanish tax authorities have issued a warning to digital currency holders stating that sizeable fines could be applied for failure to disclose the nature of their holdings.
The Ministerio de Hacienda has declared that digital holdings are considered taxable income by the authorities and that there are sizable penalties in the case that an entity hasn’t disclosed their holdings in full.
The announcement came just as the new tax year is beginning.
Spanish laws require taxes to be paid for any sale of digital currencies, but not at the point of purchase.
The warning was issued just as Spain finds itself in the middle of a new digital currency boom, especially in the capital city, Madrid, where more than 100 establishments have already started accepting payments in digital currencies.
But the increasing popularity of the crypto sector wasn’t welcomed with open arms by regulators or government agencies as they plan on enforcing strict regulations for the usage of digital currencies.
The National Securities Market Commission has also proposed strict rules for regulating the advertising of digital currencies. It has also released a joint statement with the Bank of Spain in which they pointed out how risky it was to invest in an asset class that they described as being “volatile, complex, and lacking in transparency.”