Brussels Set to Begin Talks on EU Crypto Tax, Report Reveals BlockBlog
The European Commission is preparing to discuss with member states adopting a common tax regime for crypto-assets, EU officials have said. Talks with national treasuries are set to begin next year in a bid to end the differential tax treatment of cryptocurrencies across the bloc’s 27 jurisdictions.
European Union Considers Single Tax Regime for Crypto Income and Profits
The executive body in Brussels, the European Commission, intends to launch discussions soon with the finance ministries of the Member States on the question of whether the establishment of an EU-wide tax system for crypto is warranted, a Politico report revealed Thursday, citing three EU officials.
Discussions are expected to begin in 2023, the sources told the publication. Their goal will be to share best practices, as cryptocurrency wealth is currently subject to different taxes in each country. Commenting on the initiative, a Commission spokesperson said:
Difficulties in classifying, valuing, and administering crypto assets pose challenges for tax administrations seeking to tax them fairly and efficiently.
Before implementing a single tax regime, however, the European Union must introduce new requirements for crypto companies to collect details of owners of digital assets, individuals and businesses, and share them with tax authorities across the country. EU, notes the report.
This would allow tax administrations to have a clear idea of crypto holdings. The European Commission is expected to propose such regulations in December or January, but it is expected to start enforcing them in 2026, allowing it to impose the crypto tax the following year.
European institutions have been working on a comprehensive legislative framework for cryptocurrencies called Markets in Crypto Assets (MiCA) which was agreed this summer. The media attributed the delay in its adoption to the need to translate the complex legal document into all official EU languages. The MiCA is expected to come into force in 2024.
Currently, member states apply different rules for taxing crypto income and capital gains, with rates ranging between zero and 33 percent, Politico notes. The authorities of some European countries are reviewing their policies before a possible decision at EU level.
Portugal, for example, which did not tax gains from crypto trading unless they were part of a commercial activity, now intends to impose a levy on profits from short-term crypto investments. starting in 2023. Traders who cash out crypto gains made within a year will face a 28% tax, according to next year’s budget.
Do you think the EU will eventually introduce a single tax regime for crypto assets? Share your expectations in the comments section below.
Image credits: Shutterstock, Pixabay, Wiki Commons
Disclaimer: This article is for informational purposes only. This is not a direct offer or the solicitation of an offer to buy or sell, or a recommendation or endorsement of any product, service or company. Bitcoin.com does not provide investment, tax, legal or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.
Comments are closed.