Hidden crypto wealth and tax crime in emerging markets: from voluntary disclosure to reporting-based enforcement
Ngoc Mai Nguyen, Van Thanh HoangPurpose
This paper aims to examine crypto-asset tax evasion in emerging markets as a financial crime control problem, rather than a conventional tax-collection issue. It considers how jurisdictions can use information reported and exchanged under the OECD Crypto-Asset Reporting Framework (CARF) to link reported transactions to taxpayers, select audit cases and enforce tax claims.
Design/methodology/approach
The paper develops a conceptual and comparative policy analysis, drawing on fraud theory, crypto-tax scholarship, tax-compliance theory, CARF materials and selected implementation developments in the United Kingdom, Singapore, Hong Kong and Vietnam.
Findings
Crypto wealth can move outside routine tax reporting through offshore virtual asset service providers, self-custody migration, stablecoin parking, peer-to-peer cash-out and nominee or third-party accounts. CARF improves cross-border reporting, but reported data does not by itself establish attribution, liability or intent. It must be matched to taxpayers and assessed against indicators of deliberate omission, misrepresentation and concealment before it can support audit, recovery or sanctions.
Research limitations/implications
The paper does not estimate the scale of crypto-tax evasion. Future research should test the typology and enforcement sequence using taxpayer-level, platform-level and audit data where available.
Practical implications
Emerging-market tax authorities should coordinate market recognition, tax classification, domestic reporting duties, CARF exchange, data integration and enforcement-escalation thresholds through a sequenced enforcement model.
Originality/value
The paper contributes a typology of crypto-asset tax concealment, a CARF-readiness gap matrix and a graduated enforcement model that distinguishes legal uncertainty, negligent non-reporting, deliberate tax evasion and aggravated or organised crypto-enabled tax crime.