The Dutch government is committed to ensuring that its data acquisition standards for crypto service providers are consistent with those of the rest of the EU. They claim that this will result in increased transparency.
The Netherlands is seeking input on the implementation of crypto tax monitoring laws in order to ensure compliance with EU regulations.
The Dutch government is soliciting public input on proposed legislation that would mandate the collection and sharing of user data with the local tax agency by cryptocurrency service providers, including exchanges, in accordance with European Union regulations.
The Netherlands Ministry of Finance stated in a press release on October 24 that the bill’s objective is to enhance transparency regarding the ownership of cryptocurrencies, thereby preventing tax evasion and avoidance.
The ministry further stated that the new regulations would not directly impact crypto owners, as they are already obligated to declare their cryptocurrency holdings to the Belastingdienst, the tax authority.
In accordance with the EU’s DAC8 crypto tax reporting standards, which were established last year, the Dutch tax authority would also share the data it has collected on residents of other EU countries with the tax agencies in those countries. This is included in the proposed law.
In order to reduce the administrative burden, the ministry stated that crypto service providers will only be required to report to the tax authority in the EU member state in which they are registered.
The Finance Ministry has noted that the financial landscape is presently unbalanced due to the fact that EU tax agencies lack “sufficient insight” into the crypto sector, despite the fact that Dutch crypto holders are subject to tax on their assets like other investments.
Folkert Idsinga, State Secretary for Tax Affairs and the tax administration, stated, “With this measure, we are taking a significant step in the taxation of cryptocurrencies.”
He also stated that future data-sharing measures would render crypto “transparent to tax authorities,” thereby preventing tax avoidance and evasion and ensuring that European governments do not lose out on tax revenue.
The Netherlands is one of 47 countries that adopted the Crypto-Asset Reporting Framework (CARF) from the Organization for Economic Cooperation and Development (OECD) in November.
Furthermore, the law specifies that the data of crypto service providers will be shared with non-EU countries that have adopted CARF, such as the United States, United Kingdom, Canada, Australia, Singapore, and others.
The Dutch government intends to submit the proposed legislation to the House of Representatives in the second quarter of 2025, and it will accept opinions, suggestions, and comments on the matter until November 21.
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