The EU declares war on crypto tax evasion

The issue of tax evasion is increasingly being debated. It’s one of the key issues in the regulation of crypto within the European Union. Stakeholders want to speed up the process of adoption. 

Could crypto firms be the key players in implementing this measure?

The European Union (EU) recently took a giant step forward with the adoption of the MiCA regulation on crypto. Now, the EU is pursuing another regulatory objective in this market: anti-tax evasion regulations. And it seems that progress is being made on this issue.

In fact, representatives of EU member countries have unanimously supported the implementation of such regulations. This should essentially consist of an amendment to the directive on administrative cooperation. This is a supranational text whose purpose is to ease the exchange of information between EU member states.

EU Is One Step Closer to Adopting New Rules on Sharing Crypto Tax Data https://t.co/QNLmPh3qe4

— The Coin Detective (@acoindetective) May 10, 2023

This is, in fact, a means for member states to concretely combat tax evasion within the community. By improving tax transparency between states. And it’s precisely the improvement of crypto activity transparency that is being targeted by the integration of an amendment to this community standard.

Chronologically, this amendment is the 8th change that the directive on administrative cooperation should undergo. That is why it was called “DAC8”. Introduced in December 2022, the DAC8 amendment aims to require crypto firms to disclose their users’ transactions.

Thus, these disclosures would support the tax transparency policy advocated by the EU, ultimately helping to combat crypto tax evasion. This would be a way to circumvent the volatility that characterizes the crypto industry. An obstacle that “does not ease the establishment of an accurate tax burden,” according to the EU.

With the agreement of member states of the EU, a first step has been taken in this direction. Others still need to follow before this modification comes into effect, announced for 2026. In the meantime, the crypto industry is satisfied with the EU’s efforts to bring more clarity to the functioning of the market.