UK tax authorities will reportedly soon have the power to seize Bitcoin held on exchanges. The measure is part of a new amendment to the United Kingdom Finance Bill, which seeks to strengthen the government and its ability to recover taxes owed by individuals and companies. If the amendment is passed, tax authorities will be able to issue an order to freeze digital assets held on cryptocurrency exchanges, making it easier for them to recover unpaid taxes. This power will be similar to the ability to freeze funds held in traditional bank accounts. The amendment has been welcomed by tax experts who believe it will help combat tax evasion in the cryptocurrency space. However, some industry experts have raised concerns about the potential for abuse of power, especially if there is no clear evidence of wrongdoing. Comparisons to the US SEC have also been made in this regard. The HMRC (HM Revenue And Customs) already possesses the authority to seize funds from bank accounts when people refuse to pay taxes which would put them under the eye of debts authorities. However, the organization is thinking about broadening this capability to also include online payment accounts like PayPal. In a separate consultation paper, the HMRC discussed the possibility that this could include company cryptocurrency wallets if the use of digital currencies as a method of making online payments becomes increasingly widespread.
