Misreporting of "Government to Investigate Cryptocurrency Inheritance Tax," What is the truth behind the document from the Executive Yuan of the Ministry of Justice?

The co-founder of the Taiwan-based currency exchange BitShine, Chen Pei-yun, recently shared that she received a document from the Ministry of Justice's Executive Yuan. Following reports by specific media outlets, the content was misconstrued as "government inspection of cryptocurrency inheritance tax." This sparked discussions in the community about whether the Taiwanese government would inspect "inheritance tax on cryptocurrency." People began to question whether the inheritance tax on cryptocurrency could escape the government's scrutiny after a person passes away.

However, this document may have been misinterpreted, leading to reports of "government inspection of cryptocurrency inheritance tax." What is the actual situation?

Clarifying the Issue: Asset Investigation Based on Tax Arrears

According to an interview with Chen Pei-yun, co-founder of the Taiwanese currency exchange BitShine, her interpretation is that the natural person mentioned in the official document owes taxes, prompting the enforcement agency to begin investigating the assets of the deceased individual, including cryptocurrency. Therefore, virtual assets are to some extent considered the inheritance of the deceased natural person.

The recipients of this official document include multiple Taiwanese exchanges, with the purpose of determining whether the deceased natural person who owed taxes had any cryptocurrency assets. This serves to confirm:

• Cryptocurrency is considered personal assets
• This official document is not for the purpose of investigating inheritance tax issues for heirs

Why Has the Topic Been Shifted to "Cryptocurrency Inheritance Tax"?

Chen Pei-yun stated that she did not specifically mention tax issues during the interview, and there has been no concrete information regarding inheritance tax.

Her understanding is that while cryptocurrency may appear to be considered as inheritance, there is currently no legal basis for taxation.

Estate and Gift Tax Law

According to Article 4 of the Republic of China's "Estate and Gift Tax Law": Property refers to movable property, real estate, and all other rights of value. Although cryptocurrency easily meets the criteria of property as described above, there is still no direct explanation regarding cryptocurrency.

Understanding the Official Document: Reasons for the Administrative Enforcement Agency's Action

This official document was issued by the Administrative Enforcement Agency of the Ministry of Justice, under the reference number "Inheritance Tax Enforcement Special Letter," and processed in accordance with Article 26 of the Administrative Enforcement Act, Article 19 of the Compulsory Enforcement Act, and Article 40 of the Administrative Procedure Act.

• Article 26 of the Administrative Enforcement Act: Application of the Compulsory Enforcement Act
• Article 19 of the Compulsory Enforcement Act: The enforcement court may investigate the debtor's financial status, and the person under investigation may not refuse
• Article 40 of the Administrative Procedure Act: May request the parties or third parties to provide necessary documents, information, or items

In simple terms, due to tax arrears, the court is enforcing this case from the year 2012 in the Republic of China 101st year. The statute of limitations for tax recovery can be up to 15 years. This official document is the enforcement of asset investigation for "recovery of tax arrears." [Note: Taiwan's early exchange Maicoin was founded in 2013]

However, does this mean the government will actively "investigate cryptocurrency inheritance tax"? Tax arrears can have various reasons, and the estate tax in this case may not necessarily come from "cryptocurrency assets." Instead, cryptocurrency being seen as property can be included in the list of assets of the taxpayer in arrears.