The IRS just announced they hired a couple of experts from the private sector, Sulolit "Raj" Mukherjee and Seth Wilks, to help tackle crypto and digital asset tax issues.
These guys are gonna play key roles in shaping the IRS's service, reporting, compliance, and enforcement programs for digital assets.
Mukherjee comes from a blockchain tech firm where he was the Global Head of Tax. He’s got over a decade of experience dealing with tax compliance and info reporting for financial institutions.
Wilks is joining the IRS after six years focused on digital asset tax policy. He also has a strong background in tax compliance for multinational firms, especially dealing with complicated supply chains, transfer pricing, and cross-border transactions.
Meanwhile, Russia's in the hot seat as the FATF downgraded them for not having proper rules for cryptocurrencies.
Every tax authority around the world hires people from private sectors or contracts with the consulting companies to strengthen their operations and enforcement power. It's no surprise that IRS did the same to bring in talents to help them operate more efficiently.
The modus operandi of IRS is very clear on digital assets. They want to come up with maximum governance to ensure no leakage in revenue. All the best!
I don't think this happens in all countries. The tax office in the country does not have the right to operate as a commercial company, and in my country this is impossible. To enter into a government contract with the tax authority, you need to have a lot of licenses and certifications, and as a rule, the state has a share in such companies.
Therefore, such cooperation must involve a lot of legal formalities, which are sometimes impossible to fulfill. For example, a private company cannot advise both tax and commercial companies, because this is a conflict of interest.
In my country, most public corporations are managed by corrupt officials who are mostly appointed by politicians. Most of these agencies including the revenue collection agencies are not productive because most funds realised are out in private pockets. So it is commonly said that the government is not a good businessman. In order to get the best returns, the government usually signs contracts with private firms to run these agencies and bring returns. And this decision has turned out to be the best option for the government because these public companies are well-managed by private organizations.
There have always been corporations and partnerships between state-owned companies and private organizations. It's usually called a mixed system or public-private partnership. Sometimes the government might not have enough funds to invest in business, they will always go into partnership with private organizations that can fund such projects. In some cases these private organizations are the ones that have the business idea and expertise and the government will have no other option but to partner with them. Like you rightly said it will involve lots of legal work that will ensure that the interests of both parties are balanced.
In my country there are also public partnerships, but this is almost the same, because any private company needs to fulfill a lot of requirements for such a business.
But this is a very large business where I have no experience.
After a certain period of operation of such a company, the state will conclude important contracts with it, which are not available to ordinary private business.