EU Parliament Passes DAC8 Crypto Tax Reporting Rule
DAC8's approval will help facilitate the automatic exchange of crypto asset information among EU tax authorities
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The European Parliament has overwhelmingly voted in favour of DAC8, a legislative measure introducing comprehensive tax reporting requirements for crypto transactions across the European Union (EU). With 535 votes in favour, 57 against, and 60 abstentions, the proposed rule is set to become law.
DAC8, designed to amend the EU Directive on Administrative Co-operation (DAC), obligates crypto-asset service providers to report transactions involving EU clients to the tax authorities of EU member states. This move aims to facilitate the automatic exchange of crypto asset information among EU tax authorities.
The European Commission foresees that implementing this EU-wide crypto-asset reporting framework could generate additional tax revenue ranging from €1 billion to €2.4 billion annually, as indicated in an impact assessment report by the European Parliamentary Research Service (EPRS).
The directive closely aligns with the OECD's (Organisation for Economic Co-operation and Development) common reporting standard (CRS). It identifies two categories of entities required to report information to local authorities: crypto-asset providers and crypto-asset operators. These entities, categorised as reportable crypto-asset service providers (RCASPs), must comply with DAC's reporting requirements if they have users within the EU, regardless of their size or location.
