Brussels Wants All Crypto Service Providers to Report Transactions of Europeans admin January 30, 2022

Brussels Wants All Crypto Service Providers to Report Transactions of Europeans


The European Commission has set out to oblige platforms processing crypto transactions for EU residents to share information with tax authorities in the Union. According to the proposal, all crypto service providers, regardless of where they are based, will have to abide by the new rules.

EU to Consider New Reporting Requirements for Crypto Platforms Serving European Users

The executive power in Brussels intends to push through new “tax transparency rules” for the crypto industry. The proposal announced on Thursday concerns all service providers facilitating transactions in crypto assets for customers residing in the EU, not only those that are based there.

At the moment, tax authorities in the bloc lack the information needed to monitor proceeds obtained by using cryptocurrencies, the European Commission (EC) insisted. They are limited in their ability to ensure levies are paid effectively while Europeans lose tax revenues, it stated.

The new regulations, meant to complement the Markets in Crypto-assets (MiCA) legislation and the anti-money laundering rules agreed upon earlier this year, should improve the ability of member states to detect and counter tax fraud, tax evasion and tax avoidance, the Commission elaborated.

The reporting requirements will apply to all crypto service providers, regardless of their size and location, which process transactions of clients residing in the EU. “Serious non-compliance” will trigger penalties with a set minimum level valid across the Union.

“Our proposal will ensure that member states get the information they need to ensure that taxes are paid on gains made in trading or investing crypto assets,” commented Commissioner for Economy Paolo Gentiloni. “It is also fully consistent with the OECD initiative on the Crypto Asset Reporting Framework,” he added.

The plan is to impose the new obligations on the crypto sector through amendments to the Directive for Administration Cooperation (DAC). The EC also suggested extending them to cover e-money and other digital currencies.

The draft proposal will be submitted to the European Parliament for consultations and to the Council of the European Union for adoption. The European Commission expects the updated Directive to be enforced on Jan. 1, 2026.

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What are your thoughts on the proposed tax reporting rules for crypto service providers in Europe? Tell us in the comments section below.

Lubomir Tassev is a journalist from tech-savvy Eastern Europe who likes Hitchens’s quote: “Being a writer is what I am, rather than what I do.” Besides crypto, blockchain and fintech, international politics and economics are two other sources of inspiration.

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Source : Bitcoin

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