OECD Drafts Rules to Standardise Crypto Data Sharing Among Global Tax Authorities

Changes to the existing Common Reporting Standard (CRS) have also been pitched by the OECD in a bid to accommodate the crypto assets

By Radhika Parashar | Updated: 23 March 2022 16:12 IST

OECD Drafts Rules to Standardise Crypto Data Sharing Among Global Tax Authorities

Photo Credit: Pixabay/ Sergei Tokmakov

The OECD is now seeking public comments on the proposals by April 29

Highlights

OECD will hold a public consultation meeting in May
OECD’s proposal is called Crypto-Asset Reporting Framework (CARF)
G20 nations had asked OECD to draft these rules

Crypto assets that are capable of carrying, transferring, and churning out large amounts of finances in a digital state are being considered as taxable entities by several governments around the world. The Organisation for Economic Co-operation and Development (OECD) has drafted rules instructing global tax institutions on how to share crypto-related data among each other. The aim of this regulatory framework is to merge cryptocurrencies with the international tax reporting networks. A formal document has been published by the international policy-making organisation, outlining its proposals.

OECD has named this set of rules Crypto-Asset Reporting Framework (CARF). Changes to the existing Common Reporting Standard (CRS) have also been pitched by the OECD in a bid to accommodate the crypto assets as well. Supported by the G20 nations, the CSR requires financial institutions to identify customers' tax residency, report information about financial accounts of foreign tax residents to local tax authorities, and exchange the information on a global level.

“Unlike traditional financial products, crypto-assets can be transferred and held without the intervention of traditional financial intermediaries and without any central administrator having full visibility on either the transactions carried out, or crypto-asset holdings. Therefore, crypto-assets could be exploited to undermine existing international tax transparency initiatives, such as the CRS,” the OECD said in its statement.

El Salvador Delays Bitcoin Bonds Issuance Citing Adverse Market Conditions

The tax rules laid out by the Paris-headquartered institution will be valid for CBDCs and crypto assets that can be held and transferred in a decentralised manner, without the intervention of traditional financial intermediaries.

Individuals and entities which, as businesses, provide crypto exchange services will have to identify their customers, and then report the aggregate values of the exchanges and transfers for such customers on an annual basis, the CARF rules add.

The OECD is now seeking public comments on the proposals by April 29, 2022.

Remember When Bitcoin Was 'Anonymous'?

“A public consultation meeting will be held at the end of May on the basis of the which, the OECD plans to finalise the rules and commentary to the CARF and the amended CRS,” the financial body noted.

Governments in many countries are seeing crypto taxation as a way to regulate the digital assets space.

India, for instance, has levied a 30 percent tax on crypto-based incomes.

Australia is also planning to tax crypto assets as part of a broader revamp of its payment policies.

Asus India's Arnold Su joins this week's Orbital, the Gadgets 360 podcast, to talk about how the PC maker is planning to grow its presence in the country. Orbital is available on Spotify, Gaana, JioSaavn, Google Podcasts, Apple Podcasts, Amazon Music and wherever you get your podcasts.

Affiliate links may be automatically generated - see our ethics statement for details.

Comments

For the latest tech news and reviews, follow Gadgets 360 on X, Facebook, WhatsApp, Threads and Google News. For the latest videos on gadgets and tech, subscribe to our YouTube channel. If you want to know everything about top influencers, follow our in-house Who'sThat360 on Instagram and YouTube.

Further reading: Cryptocurrency, Crypto Tax, OECD, Crypto Assets, CBDC

Radhika Parashar

Email Radhika

Radhika Parashar is a senior correspondent for Gadgets 360. She has been reporting on tech and telecom for the last three years now and will be focussing on writing about all things crypto. Besides this, she is a major sitcom nerd and often replies in Chandler Bing and Michael Scott references. For tips or queries you could reach out to her at RadhikaP@ndtv.com. More