New tax transparency rules will help Member States shine a light on the crypto-asset sector

The Commission welcomes the political agreement (‘general approach’) reached by EU Finance Ministers today on new tax transparency rules for all service providers facilitating transactions in crypto-assets for customers resident in the EU. Based on a Commission proposal, the new rules complement the Markets in Crypto-assets (MiCA) Regulation and transfer in funds Regulation (TFR), and are fully consistent with the OECD initiative on the Crypto-Asset Reporting Framework.

Fair and effective taxation is key to securing revenues for public investment and services, while creating a business environment in which innovation can flourish. However, tax authorities currently lack the necessary information to monitor proceeds obtained by using crypto-assets which are easily traded across borders. This severely limits their ability to ensure that taxes are effectively paid, which means European citizens lose important tax revenues.

The Directive will improve Member States’ ability to detect and counter tax fraud, tax evasion and tax avoidance, by requiring all crypto-asset providers based in the EU – irrespective of their size – to report transactions of clients residing in the EU. Moreover, the updated Directive has been extended in scope to include reporting obligations of financial institutions regarding e-money and central bank digital currencies and the automatic exchange of information on advance cross-border rulings used by natural persons.

The new reporting requirements on crypto-assets, e-money and central bank digital currencies will enter into force on 1 January 2026. Final adoption of the new rules will be possible when the consultative opinion of the European Parliament becomes available.