Cryptocurrencies

Lord Sikka Excerpts

Wednesday 2nd March 2022 Lords Chamber

[Baroness Penn (Con)]

My Lords, I have indeed read those comments by the Governor of the Bank of England. My noble friend is absolutely right that the situation is dynamic and the market in crypto assets is growing. That is why the Bank of England is monitoring crypto assets’ financial stability. It is also why the Cryptoassets Taskforce, the Treasury, the Financial Conduct Authority and Bank of England are taking an approach to regulate aspects of crypto assets, particularly those that pose the greatest threat to our financial stability.

[Lord Sikka (Lab)]

My Lords, there is no specific tax legislation relating to cryptocurrency assets, so holders of them are instead covered by broader tax rules, which is highly unsatisfactory. How long do the Government need to deal with this problem?

[Baroness Penn (Con)]

My Lords, profits from trading in and gains from disposing of crypto assets are taxed in the same way and at the same rate as those from other assets, as the noble Lord says. HMRC’s Cryptoassets Manual is one of the most detailed publications from any tax administration and explains the tax consequences for different types of transactions involving crypto assets, for both businesses accepting them and individuals using them.