In a bid to combat crypto tax evasion, the Malaysian government has launched ‘Ops Token’, a special operation aimed at uncovering undisclosed crypto-related activities. The Inland Revenue Board (IRB) has initiated raids across various locations, targeting firms suspected of non-compliance in reporting their crypto transactions.

Similar to India’s regulatory approach, Malaysia seeks to enhance transparency and oversight in the crypto sector, where transactions often occur anonymously, facilitating potential illegal activities. The IRB, in collaboration with the Royal Malaysia Police and CyberSecurity Malaysia (CSM), has mobilized a team of 38 security personnel to conduct raids at ten sites within the Klang Valley.

Cryptocurrencies in Malaysia are categorized as securities and are legally tradable, although they do not hold legal tender status. Crypto businesses operating in Malaysia are required to adhere to the country’s tax laws.

This crackdown comes amidst projections that Malaysia’s cryptocurrency market will generate approximately $306.6 million in revenue by 2024, with an estimated three million residents actively participating in crypto activities.

The Malaysian government’s actions are part of a broader effort to combat tax evasion across various sectors. Earlier this year, Prime Minister Datuk Seri Anwar Ibrahim directed authorities to clamp down on tax evaders following reports of significant revenue losses amounting to RM 6.34 billion due to evasion.

Companies engaged in crypto activities now face heightened scrutiny and potential audits. Non-compliance with tax regulations in Malaysia can result in penalties of up to RM 20,000 and imprisonment for up to six months.

This crackdown follows previous measures by the Malaysian government to address issues related to crypto mining operations, particularly concerns over excessive electricity consumption.