Summary:
- Minister Lugoloobi emphasized the need for greater regulatory oversight and international cooperation to address these challenges effectively.
PARAGUAY: The Minister of State for Planning in the Ministry of Finance, Amos Lugoloobi, has expressed concern over the limited data available to African governments on crypto assets, despite their increasing use and investment globally.
Speaking at the 2024 Plenary Meeting of the Global Forum on Transparency and Exchange of Information for Tax Purposes in Paraguay on Tuesday, Minister Lugoloobi discussed the risks posed by crypto assets. He highlighted that the trade of crypto assets is decentralized, with enablers of the trade often operating beyond traditional regulatory reach.
“Virtual asset service providers need not have a physical presence in a country to facilitate trade,” said Lugoloobi, noting that the use of virtual private networks (VPNs) complicates monitoring online transactions and payments. “Users of VPNs can bypass national payment gateways, making it difficult to detect when digital assets are converted into cash payments.”
The minister also pointed out that only a few jurisdictions have enacted legislation requiring virtual asset service providers (VASPs) to conduct due diligence and report transactions.
“Some countries’ legislation remains unclear on the taxation regime for digital assets. This creates additional opportunities for tax avoidance through aggressive tax planning,” he added.
Minister Lugoloobi emphasized the need for greater regulatory oversight and international cooperation to address these challenges effectively.
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