OECD tackles crypto taxation; seeks public input
The Organisation for Economic Cooperation and Development (OECD) is concerned with the potential impact of crypto on taxation frameworks. It has opened a public consultation document for feedback, as it seeks to modernise taxation to include these digital assets.
In the 101-page document (you can read it here) the OECD acknowledges that crypto assets are “affecting tax administrations, which must adapt to the growing role of crypto assets. In particular, several characteristics of crypto assets are likely to pose novel challenges in tax administrations’ efforts to ensure taxpayer compliance.”
To combat that, the OECD is looking to “modernise the tax transparency instruments available to tax administrations,” and this is what it is putting to public consultation. Its strategy is three-fold:
- Develop a new global tax transparency framework that provides for the automatic exchange of tax information on transactions in crypto assets in a standardised manner.
- Introduce a set of amendments to the Common Reporting Standard (CRS), in order to bring new financialassets, products and intermediaries in scope, because they are potential alternatives to traditionalfinancial products.
- Launch the first comprehensive review ofthe CRS, with the aim of further improving the operation of the CRS, based on the experience gained by governments and business.
The OECD is looking to the public for thoughts on what crypto assets should be covered under the proposal, and what the tax reporting and procedures relating to collecting information from those engaging in crypto transactions are appropriate.
The OECD is expecting to present the amended reporting rules in October, when G20 leaders will meet for a summit.
With 38 member countries – including the US, UK and Japan – the OECD is an intergovernmental organisation, and what its member states decide tend to lead global standards. How the OECD crafts a framework to govern the taxation of crypto assets is likely to figure into the regulatory environment across most of the world.