Sweden demands $90M in outstanding tax from crypto miners

Swedes who mine cryptocurrencies owe approximately $90 million in back taxes following discoveries of tax evasions spanning over a four-year period by government authorities.

Between 2020 and 2023, the Swedish Tax Agency —Skatteverket— carried out investigations into the activities of 21 crypto-mining companies. The results uncovered that 18 of these firms had submitted “misleading or inadequate” information to secure tax advantages.

Based on the report from the agency, certain cryptocurrency companies gave false business characterizations to prevent paying Value-Added Taxes (VAT) for taxable activities. Some also discovered methods to bypass import taxes on mining machinery or income tax on mining earnings.

A rough translation of the Swedish Tax Agency’s statement read:

“The described approach leads to tax disappearing from the country in the form of incorrect payments of input VAT, unpaid output VAT and unreported crypto assets.”

Crypto-mining companies that have defaulted on their taxes owe the Swedish tax authorities over 990 million Swedish krona (SEK), which is equivalent to around $90 million. This amount consists of approximately 932 million SEK ($85.4 million) in unpaid Value-Added Tax (VAT) and an additional 57.9 million SEK ($5.3 million) as tax surcharges.

Sweden demands $90M in outstanding tax from crypto miners

As crypto mining companies challenged a $90 million tax claim from the Swedish Tax Agency in court, two of these companies successfully overturned the decision. The other appeals were denied. “The following figures have been revised based on the rulings.”

In November 2023, Hive Digital Technologies, a crypto mining company, purchased both a business site and a data center located in Boden, Sweden. During this transaction, Johanna Thornblad, the Swedish representative of Hive, expressed: “We’re thrilled to announce the acquisition of this property in Boden. Equipped with a state-of-the-art data center, we’ll be expanding our crypto mining operations here.”

“The new data center will enable HIVE to grow its regional footprint while further demonstrating its commitment to its ESG focus, sustainable practices, environmental responsibility, and energy efficiency with its newest “green” energy powered data center.”

The company announced that its new property will not only serve as a home for their upcoming ASIC servers but also boost their Bitcoin (BTC) mining output.

Hive manages data centers in Canada, Sweden, and Iceland where it runs operations. Notably, they encourage the utilization of renewable energy for mining virtual currencies like Bitcoin over the internet.

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2024-04-18 11:24