Tax authorities in the United Kingdom and South Korea are deploying advanced technological tools to strengthen enforcement and compliance in the cryptocurrency sector ahead of new tax regimes. His Majesty's Revenue and Customs (HMRC) in the UK has issued a market engagement notice to explore the procurement of crypto forensic software and investigative support services. The initiative, with a combined estimated contract value of £3.42 million ($4.6 million) over three years, aims to equip HMRC's Fraud Investigation Service and Risk and Intelligence Service with capabilities for automated case triage, deep forensic analytics, cross-chain transaction tracing, and advanced data visualization.
The proposed contracts, which could run from April 2027 to March 2029 with a possible extension, would provide 75 total licenses and 750 hours of annual investigative support. Colby Mangels, global head of government solutions at Taxbit and a former OECD advisor, commented that this move reflects a global shift where governments are building modern compliance infrastructure for digital assets. He noted the sophistication HMRC is seeking and linked the investment to the UK's ambition to be a global crypto hub, citing its early adoption of the OECD's Crypto-Asset Reporting Framework.
Simultaneously, South Korea is preparing to launch a $2.3 million AI-driven monitoring platform to analyze cryptocurrency transactions ahead of its long-delayed digital asset tax, scheduled for implementation in January 2027. The system is designed to track trading activity, identify investment gains, and detect potential tax evasion by analyzing data from exchanges. Authorities have indicated that insights generated by the AI platform may be shared with other institutions like the Bank of Korea and the Customs Service.
