Former Secretary of State for Digital, Culture, Music and Sport Matt Hancock said the UK needs to take a long-term approach, lower crypto taxes and grow digital innovation.
“HMRC has taken a revenue maximizing approach … we are applying it with a sledgehammer … What we need to do is look at growth maximizing future revenues that are much greater is to do
Hancock said in his keynote address at Zebu Live in London on September 22nd.
The UK tax authority, HMRC, was the focus of the Q&A section of Mr Hancock’s speech. UK tax law treats cryptocurrencies like any other asset. This means that all cryptocurrency transactions are subject to a 20% capital gains tax.
Whenever a digital asset is traded for another asset, it is a taxable event. Additionally, activities such as mining and yield farming are considered income and he is taxed at 40% to anyone earning over £50,271. However, if her annual income is less than £12,570, she pays 0% income tax.
Capital gains tax in the UK is complicated to understand and you need to calculate your income tax to see if you are within the basic tax rate. Those who fall within the “basic tax rate” he pays 10% capital gains tax, and those who do not, he pays 20%.
Hancock is bullish on cryptocurrencies and digital assets as a way for the UK to regain dominance in global financial markets and believes the current UK tax rate on cryptocurrencies is not optimal for domestic innovation. .
MP also argued that some laws need to be rewritten to accommodate innovation within the crypto industry.
“Within the existing framework, regulators need to be proactive, proactive, open and risk-taking rather than against all this.
During his keynote, Hancock repeatedly solicited feedback from the UK public on the challenges they face dealing with cryptocurrencies in the UK. UK citizens wishing to contact Hancock should contact Congress website.
