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The Dutch government wants to align its data collection rules for crypto service providers with the rest of the EU, saying it would “create more transparency.”
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The Dutch government has asked for public input on proposed laws that would require crypto service providers, such as exchanges, to collect and share user data with the local tax authority — aligning with European Union rules.
“The aim of the bill is to create more transparency about the ownership of cryptocurrencies, which can prevent tax avoidance and evasion,” the Netherlands Ministry of Finance said in an Oct. 24 press release.
It added “nothing will change” for crypto owners under the proposed rules as they’re already required to file a tax return of their holdings to the country’s tax authority, the Belastingdienst.
The new bill would see the tax agency share the service provider-collected data about residents of other EU countries with the tax authorities of those nations, which was mandated under EU-wide crypto tax reporting rules adopted last year known as DAC8.
The rules limit the admin burden on crypto service providers as “they only have to report in the EU member state where they are registered,” the ministry explained.
Dutch crypto owners must pay tax on their holdings like any other investment, but the Finance Ministry said EU tax authorities don’t yet have “sufficient insight” into crypto, leading to an uneven playing field in the finance sector.
A translated and highlighted excerpt of the proposed bill relating to some of the data to be collected by crypto service providers. Source: Rijksoverheid
“With this bill, we are taking an important step in the taxation of cryptocurrencies,” Folkert Idsinga, the state secretary for tax affairs and the tax administration, said in a statement.
He added that in the future, the data exchanges will mean crypto “will become transparent to tax authorities,” which would “prevent tax avoidance and evasion and European governments will no longer miss out on tax revenues.”
Related: EU markets watchdog urges amendments to MiCA crypto regulations
The Netherlands was one of the 47 countries that in November implemented the Crypto-Asset Reporting Framework (CARF) from the Organisation for Economic Cooperation and Development (OECD).
The proposed legislation also adds that the crypto service provider-collected data would be shared with the non-EU nations that signed on to the CARF, which includes the United States, the United Kingdom, Canada, Australia, Singapore and others.
Opinions, advice and comments on the proposed rules are due by Nov. 21, and the government is aiming to submit the bill to the country’s House of Representatives in the second quarter of 2025.
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This article first appeared at Cointelegraph.com News
