New EU rules mandate the automatic exchange of data on cryptocurrency revenues reported by service providers, enhancing tax cooperation among member states.
The Council of the European Union has taken a significant step in tax compliance by adopting a directive that includes the automatic exchange of data on cryptocurrency revenues reported by service providers. This directive expands existing registration and reporting obligations, focusing on enhanced cooperation between tax administrations across the EU.
The move acknowledges the challenges posed by the decentralized nature of crypto assets in ensuring tax compliance. To address this, the directive enforces mandatory automatic data exchange between tax authorities and crypto-asset service providers. It aims to cover various categories of income and assets, including decentralized crypto assets, stablecoins, e-money tokens, and select non-fungible tokens (NFTs). These changes align with the EU’s recently introduced Markets in Crypto Assets (MiCA) law.
This directive, approved unanimously by member states’ finance ministers, was introduced by the European Commission in December 2022 and endorsed by the European Parliament in September 2023. It amends Directive 2011/16/EU on Administrative Cooperation in the Field of Taxation (DAC) and will take effect 20 days after publication in the Official Journal of the EU. Additionally, it includes provisions for the exchange of cross-border rulings for high-net-worth individuals.