UK think tank launches crusade against ‘monitoring’ CBDCs

The UK Tax Reform Council has launched a campaign against the Bank of England’s plan to introduce a central bank digital currency (CBDC). The non-profit organization warns that such a move could seriously damage the individual’s privacy and lead to far-reaching changes in the tax system.

The newly formed Tax Reform Council includes monetary economist John Chown, co-founder of the Institute for Fiscal Studies, on its advisory board. The Tax Reform Council believes that implementing a CBDC will lead to increased government surveillance, greater intrusion by the tax authorities and an increased risk of cyber attacks on the country’s monetary system.

The think tank shares similar concerns to the UK Bitcoin (BTC) community which has been vocal in its criticism of CBDCs. Jordan Walker, co-founder of the UK’s Bitcoin Collective, explained that “the rollout of CBDCs in the UK is dangerous on a number of fronts. We would hand more control over our money to the government and the central bank.”

“This ties the monetary system even more closely to the political system that has caused significant problems in the past and present. Instead, we should aim to separate money and politics.”

The advisory board economists including Patrick Minford, Julian Jessop and Chown stated that “The decision by the Bank of England to pursue a UK CBDC raises a number of very real concerns.” The group seeks to raise awareness of the “increased government surveillance” that CBDCs can offer.

CBDCs claim to offer greater financial inclusion, reduced costs for businesses and consumers and increased security. However, Bitcoin already offers these benefits and more: El Salvador beat parts of the population by introducing the Bitcoin law, while Bitcoin also provides a way out for those living in authoritarian regimes.

In the UK, the Treasury and the Bank of England have been recruiting for CBDC roles. The Bank of England has highlighted the “need” to create a digital version of the British pound, despite backlash from the wider crypto community.

Related: The UAE Central Bank will issue CBDC as part of its economic transformation programme

According to the Tax Reform Council, every personal transaction made using a CBDC will be recorded on the Bank of England’s private blockchain ledger, giving the taxman unprecedented access to individuals’ financial history. The press release stated that this is already happening in China with the renminbi CBDC.

Walker sounded the alarm: “I think we’re closer to the rollout than a lot of people think, and unless we have higher education around this topic, we’re going to see a lot of people in this country being unwittingly sucked into this digitized money control.”