- The Netherlands has launched a public consultation on a new crypto tax reporting bill, aiming to enhance transparency and align with European standards
- The proposed law mandates crypto service providers to report user data to tax authorities, supporting broader EU-wide DAC8 and OECD CARF frameworks
- Public feedback on the bill is open until November 21, 2024, with implementation expected by 2026 if approved
The Dutch Ministry of Finance has introduced a draft bill to tighten tax reporting requirements for cryptocurrency service providers as part of a European initiative to improve transparency and prevent tax evasion. The proposal, open for public feedback from October 24 through November 21, 2024, seeks to align the Netherlands with the EU’s DAC8 directive and the organization for Economic Co-operation and Development’s (OECD) Crypto-Asset Reporting Framework (CARF) to ensure crypto assets are reported similarly to traditional assets. The country took steps to end anonymous crypto trading in 2019 and has been at the forefront of other crypto regulatory efforts in the EU.
A Move Towards Greater Transparency
The Dutch government’s bill, if enacted, would require crypto platforms to collect and report detailed information on users to the tax authority, the Belastingdienst. This measure, which would become effective in 2026, is intended to close gaps in crypto tax compliance, reinforcing the importance of transparency.
Folkert Idsinga, State Secretary for Tax Affairs, noted that the initiative aims to ensure crypto transactions become as visible to authorities as traditional financial transactions, saying it will “combat tax avoidance and evasion” by allowing better cooperation across EU member states.
Aligning with Broader EU Standards
The Netherlands’ proposed legislation supports the EU’s DAC8 directive, which simplifies tax reporting for crypto service providers, requiring them to report transactions only in the country of their regulatory registration. The DAC8 framework, adopted across the EU, seeks to ease the administrative load on crypto exchanges by allowing streamlined reporting that applies throughout the Union. Additionally, CARF expands these standards to non-EU nations, fostering international cooperation on tax transparency and enforcement.
The Dutch Ministry of Finance is inviting comments and advice from the public until late November 2024. Following this period, the bill will be revised based on the feedback and is expected to be presented to the House of Representatives in early 2025. If passed, the legislation will establish a unified reporting system across Europe, simplifying compliance for crypto businesses and enhancing tax enforcement in the rapidly evolving digital asset sector.
