With MiCA, the EU recently created extensive regulations to deal with cryptocurrencies in Europe. Now, one would like to go a step further and also access data from those crypto companies that are not based in the EU.
If the European Commission has its way, this should be included in the new tax transparency regulations. While this should make transactions with crypto assets easier for EU citizens, it should also give tax authorities the ability to access all transactions.
No anonymity when dealing with companies outside the EU
With the new proposal, the European Commission wants to supplement regulation on crypto markets and anti-money laundering regulation. It considers that fair and effective taxation protects the revenues of its Member States. At the same time, the goal is to create a business environment in which investments can thrive.
According to the European Commission, however, tax authorities do not yet have all the information necessary to control the income generated by cryptocurrencies. After all, these can be traded across borders without any problems. This is a thorn in the side of the authorities, they want to make sure in a comprehensive way that anyone who earns an income also pays taxes on it. The cryptocurrency that citizens buy will therefore no longer matter if all companies operating in the EU are required to report all transactions.
Extension to banks
With the proposal that all crypto companies must provide their data to the tax authorities, the EU wants to uncover and fight tax evasion more intensively. To this end, one would like to oblige all providers of cryptographic assets to report their transactions by customers residing in the EU. This is said to happen regardless of the size or location of the crypto company.
The proposal also provides for a minimum level of sanctions. These should come into force if companies refuse to comply with this reporting obligation. At the same time, we want to extend reporting obligations to banks, as well as the automatic exchange of information. Individuals should thus be deprived of any possibility of evading tax.
This proposal now goes to the European Parliament and the European Council. If accepted by these institutions, it should enter into force on January 1, 2026.
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