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EU to tighten cryptocurrency regulations — RT Business News

Crypto service providers will be forced to report transaction data to tax authorities

The European Commission (EC) plans to tackle tax fraud and tax evasion in the crypto industry by requiring all digital asset service providers to report transactions involving customers residing in the EU.

A mechanism to compel companies outside the bloc to disclose user assets is being worked on. According to the EC, tax authorities currently lack proper information on the earnings of crypto holders, which limits tax revenue from the sector.

The proposed rules, known as the Eighth Administrative Cooperation Directive (DAC8), aim to target billions of euros in taxes on crypto assets hidden abroad. According to EC estimates, member states lost €93 billion ($97.8 billion) in 2020 in VAT revenue, a quarter of which can be conservatively attributed to fraud.

“The blanket of anonymity, the fact that there are currently over 9,000 different crypto assets, and the inherently digital nature of trade mean that many users of crypto assets who make huge profits fall under the radar of authorities. national taxes”, EU Economy Commissioner Paolo Gentiloni said in a statement on Thursday, adding that this was not acceptable.

Biden hints at upcoming regulation of crypto and CBDCs

Additionally, the executive arm of the EU has proposed extending reporting obligations for financial institutions to cover e-money and digital currencies.

The proposal, which complies with the new reporting rules, will require the unanimous approval of the bloc’s 27 member states. It is expected to enter into force in January 2026.

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