The new rules, which come as an update to the Directive on Administrative Cooperation (DAC8), complement the Markets in Crypto-assets (MiCA) Regulation and transfer in funds regulation (TFR) and are fully consistent with the OECD initiative on the Crypto-Asset Reporting Framework.
Fair and effective taxation is key to securing revenues for public investment and services, while creating a business environment in which innovation can flourish. However, tax authorities currently lack the necessary information to monitor proceeds obtained by using crypto-assets which are easily traded across borders. This severely limits their ability to ensure that taxes are effectively paid, which means European citizens lose important tax revenues.
The Directive will improve Member States’ ability to detect and counter tax fraud, tax evasion and tax avoidance, by requiring all crypto-asset providers based in the EU – irrespective of their size - to report transactions of clients residing in the EU. Moreover, its scope has been extended to include reporting obligations of financial institutions regarding e-money and central bank digital currencies and the automatic exchange of information on advance cross-border rulings used by natural persons.
The Directive also presents advantages to business and users, since it provides common reporting rules in the EU as a whole. Together with the MiCA Regulation and the update of Anti money-laundering rules, the Directive provides a comprehensive and transparent legislative framework for the EU, which leads to legal certainty and provides an attractive environment for business.
The final text of the Directive is available here.
Details
- Publication date
- 17 October 2023
- Author
- Directorate-General for Taxation and Customs Union