Key Takeaways
- DAC adheres to the Crypto-Asset Reporting Framework (CARF)
- DAC8 got overwhelming support in the form of 535 members voting in favour
During a plenary session on September 13 in Strasbourg, France, members of the European Parliament showed overwhelming support for the eighth version of the Directive on Administrative Cooperation (DAC8), a cryptocurrency tax reporting regulation.
With a resounding 535 votes in favor and only 57 against, alongside 60 abstentions, the European Parliament firmly endorsed DAC8. This pivotal decision clears the path for the formal adoption of DAC8, a legislative initiative designed to improve the reporting of cryptocurrency-related taxes within the European Union.
DAC8, an integral part of the European Union’s legislative efforts, focuses on enhancing tax reporting for cryptocurrency transactions within member states. This crucial vote removes the final hurdle to the regulation’s formal adoption.
The primary objective of DAC8 is to equip EU tax authorities with the tools necessary to monitor and evaluate all cryptocurrency transactions conducted by individuals and organizations within the EU member states. This move is aimed at reducing the risk of tax fraud and evasion associated with the crypto market.
This legislative milestone follows the approval of the Markets in Crypto-Assets (MiCA) law in May 2023. DAC8 is part of a series of administrative cooperation directives, each addressing distinct aspects of financial regulation.
According to European Union documents, DAC8 is intended to grant tax authorities the authority to track and assess all cryptocurrency transactions conducted within member states. This reporting framework mandates that crypto-asset service providers report transactions made by EU clients. By doing so, it facilitates tax authorities’ ability to monitor crypto asset trades and associated gains, thereby mitigating the risk of tax fraud and evasion.
With the September 13 plenary session vote successfully passed, DAC8 is on track for implementation. EU member states are now tasked with incorporating the rules into their systems, with a deadline set for December 31, 2025. The regulation is slated to officially take effect on January 1, 2026.
The inception of DAC8 dates back to December, with formal approval granted on May 16, following the enactment of the Markets in Crypto-Assets (MiCA) law. DAC8 is closely aligned with the Crypto-Asset Reporting Framework (CARF) and adheres to amendments in reporting standards published by the Organisation for Economic Cooperation and Development (OECD) in October, pursuant to a G20 mandate.
