The US Internal Revenue Service (IRS) on Tuesday, March 3, hosted a crypto Tax summit at its headquarter in Washington, D.C. In a panel discussion about cryptocurrency exchanges, executives from exchanges asked US IRS for greater regulatory clarity rather than vague suspicion from the tax authority.
According to reports form various crypto news outlet, Coinbase head of global tax information Solulit Mukherjee, Kraken head of global tax Lisa Askenazy Felix, Jamison Sites, Washington national tax manager for RSM Tax LLP, and John Cardone, assistant deputy commissioner for compliance integration at IRS were present in the discussion.
Kraken executive said that crypto industry was still in its nascent stages and tried its best to be compliant with the jurisdictions in which they operated.
Lisa Askenazy Felix, said:
“Because it’s such an emerging industry, we are still very much trying to react to all these different developments in all these domestic jurisdictions we might be doing business in and all these foreign jurisdictions we might be doing business in.”
Coinbase head of Global Tax information Solulit Mukherjee said that crypto exchanges and related institutions had every reason to cooperate with regulatory authorities. Mukherjee said:
“There is no benefit to a Coinbase or a Ripple to not doing the right thing.”
According to the executives form exchanges, the crypto world has seen outsized scrutiny from regulators compared to its size and darkness. The current regulatory environment is proving very burdensome for exchanges to continue their businesses in this nascent industry, particularly for startups that are spending time and money to remain compliant with U.S. rules.
Agreeing with the crypto executives, the national tax manager for RSM Jamison Sites, said that all big player such as Coinbase, Kraken, and Ripple were very startup. Overregulatory environment is not justice to this industry. Sites said:
“Imagine if email in the 80s, when all these startups were coming in, imagine that the US Postal Service came in and said ‘hey, this is unlawful delivery.”
Askenazy Felix said:
“I think most of us in the room would agree that there is no clarity.”
In response to an idea about the development of a central repository of exchange data that would both standardize that information as well as providing access to law enforcement, both Mukherjee and Felix said no citing risk that such central database could be hacked and, as a result, lead to the theft of sensitive data and other privacy issues.