European Union Council Approves DAC8 Crypto Tax Reporting Regulation
October 18, 2023 3:46 PM
The European Union Council formally accepted the eighth version of the Directive on Administrative Cooperation.
On October 17, the Council of the European Union formally enacted the eighth version of the Directive on Administrative Cooperation (DAC8), a bitcoin tax reporting requirement. The legislation will go into effect after it is published in the EU's Official Journal.
Following the passage of the Markets in Crypto-Assets (MiCA) law in May 2023, the DAC was established. The number eight in the name of the revised program implies that it is the eighth version, with each previous directive dealing with a different component of financial supervision. The goal of DAC8 is to provide tax collectors the authority to monitor and analyze any cryptocurrency transaction carried out by people or companies in any other EU member state.
DAC8 currently complies with the Crypto-Asset Reporting Framework (CARF) and the MiCA laws, effectively embracing all cryptocurrency asset transactions within the European Union.
The European Parliament overwhelmingly supported DAC8 in September, with 535 votes in favor and only 57 votes against.
Regulators in the United States are likewise working hard to get the crypto tax collection mechanisms in place as quickly as possible. On October 11, seven members of the United States Senate urged the Treasury Department and the Internal Revenue Service to go forward with a regulation establishing some tax reporting requirements for cryptocurrency dealers "as soon as possible." They questioned a two-year delay in implementing crypto tax reporting regulations, which are set to take effect in 2026 for transactions occurring in 2025.