DAC8 rules on crypto tax are adopted by the Council of Europe.
As a result of the eighth iteration of the Directive on Administrative Cooperation, the Council of the European Union officially adopted it.
The European Union has taken a significant step forward in regulating cryptocurrencies with the formal adoption of DAC8 on the oct. 17, the Directive on Administrative Cooperation. This cryptocurrency tax reporting rule will have a far-reaching impact on the crypto landscape within the EU. Today, the Council adopted a directive amending EU rules on administrative cooperation in the area of taxation. The amendments mainly concern the reporting and automatic exchange of information on revenues from transactions in crypto-assets and on advance tax rulings for the wealthiest (high-net-worth) individuals. The aim of the Directive is to strengthen the existing legislative framework by enlarging the scope for registration and reporting obligations and overall administrative cooperation of tax administrations.
DAC8, in its eighth iteration, is poised to become a crucial tool for tax authorities across member states. It aligns with the Crypto-Asset Reporting Framework (CARF) and incorporates the regulations outlined in the Markets in Crypto-Assets (MiCA) legislation.This new directive empowers tax collectors to monitor and evaluate every cryptocurrency transaction conducted within the EU. It signifies a concerted effort by the EU to ensure transparency and compliance within the cryptocurrency market, addressing concerns related to tax evasion and illicit activities.
DAC8 received overwhelming support in the EU Parliament, with a substantial majority voting in favor. This broad consensus highlights the urgency of establishing clear tax reporting mechanisms in the rapidly evolving world of cryptocurrencies. As part of the EU Parliament adoption vote in September, the DAC8 received overwhelming support from its members, with 535 votes in favor and just 57 against.
While the EU progresses with DAC8, the United States is also making strides in crypto tax regulation. Seven US Senators recently urged the Treasury Department and IRS to expedite rules for crypto broker tax reporting. This move reflects the growing global interest in regulating cryptocurrency transactions.
As cryptocurrency continues to gain prominence, governments and regulatory bodies are working to strike a balance between innovation and accountability. The adoption of DAC8 in the EU and the push for crypto tax rules in the US are significant developments in shaping the future of cryptocurrency regulations worldwide. Stay informed as these changes unfold in the dynamic cryptocurrency landscape.