COVID-19, Cryptocurrency

Plans to Tax Crypto to help with the COVID-19 pandemic efforts – OECD

The Organization for Economic Cooperation and Development (OECD) promotes its affiliates to adopt crypto tax frameworks.

As reported in the new OECD report, the group said it wants to promote transparency in all transactions involving cryptoassets. Assuring revenues generated from trading are taxed in the world’s biggest economies.

Designed for the attention of G20 finance ministers and central bank governors, the document stated that, in the aftermath of the ongoing coronavirus pandemic crisis, the global public’s “tolerance for tax evasion and tax avoidance is expected to reach historic lows.”

And this answered, the OECD requires a set of criteria to “tackle increasingly sophisticated, non-compliant taxpayers and aggressive tax planning, to collect missing and much-needed tax revenues.”

The team said the new tax reporting framework would use the G20/OECD’s Common Reporting Standard (CRS) as its starting point. It described the CRS as the “global benchmark for ensuring tax transparency with respect to financial assets and income.”

The G20 is a global forum comprising central bank governors from 19 major economies and the European Union.

The report’s authors addressed,

“Building on the existing framework for the exchange of financial account information will help ensure consistency between the reporting on traditional financial assets and cryptoassets, as well as the income derived from such assets.”

The new information flows will use the same architecture used by the CRS.

The collected data “will be reported by intermediaries to the tax authorities in their jurisdiction of residence. The tax authorities will then automatically exchange the information with the jurisdictions in which the relevant taxpayers are residents,” the OECD wrote.

Given the “dynamic and highly mobile nature of the cryptoasset market,” the OECD said that its objective was to “design the international exchange framework in such a manner that all jurisdictions hosting intermediaries can fully participate.”

And the organization warned that it would not stop at merely making vague-sounding recommendations, concluding,

“We will continue to work on the detailed technical proposals for the new tax reporting framework for cryptoassets, with a view to presenting a comprehensive implementation package to the G20 in 2021.”

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