EU to strengthen tax oversight from next month…"Cryptocurrency firms also required to report"

The European Union (EU) will require cryptocurrency firms to file tax reports starting next month.

According to CoinDesk on the 24th (local time), the EU's 'Digital Assets Tax Transparency Directive (DAC8)' will be fully implemented from the 1st of next month. The core of DAC8 is to expand the scope of monitoring in the tax cooperation system among EU member states to include crypto assets and related service providers. CoinDesk reported, "'Crypto-asset service providers (CASP), including exchanges and brokers, must report detailed data on user information and transaction histories to national tax authorities.'"

The information that cryptocurrency companies report to authorities will be shared among all EU member states. CoinDesk said, "(DAC8) fills the gap in the existing tax reporting system that excluded parts of the crypto industry," and "(through DAC) tax transparency and oversight of crypto transactions will be significantly strengthened."

DAC8 will operate alongside the EU's MiCA regulation. While the MiCA law focuses on regulating the crypto industry, the core of DAC8 is 'monitoring tax payment records.'

The EU will operate a six-month regulatory grace period. Cryptocurrency companies must complete their tax reporting systems, customer due diligence, and internal control systems by early July next year.