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EU policymakers agreed to tax with blockchain technology crypto news

On Tuesday, the members of the European Parliament (MEPs) voted in favor of a resolution that calls for the use of blockchain technology to fight tax evasion and urges member states to coordinate more on the taxing of crypto assets.

The European Parliament suggested in favor of a resolution that acts as a crypto- concentrated double whammy — diving both duty elusion through crypto- means and streamlining rules for their taxation.

EU policymakers agreed to tax with blockchain technology crypto news
EU policymakers agreed to tax with blockchain technology crypto news

The resolution tries to identify what makes a taxable event and suggests that the conversion from crypto to edict currency is the most feasible option. The European Commission is yet to easily define this and other possible taxable events and is considering the borderless nature of crypto- means.
Also, the exchange of taxpayer information 

by cross-national duty administration will need to include information on crypto- means. still, the policy also calls for a “ simplified duty treatment ” for lower deals.

Blockchain technology is also pushed forward as an instrument for duty collection, relating the technology’s eventuality to “ automate duty collection, limit corruption and better identify the power of palpable and impalpable means allowing for better trying mobile taxpayers, ” according to the European Parliament’s release.
The Commission is called upon to apply blockchain technology to taxation programs. It also encourages EU member states to reform their taxation authorities.

The train passed in the Parliament’s grand session with an inviting maturity of 566 votes in favor, 7 votes against, and 47 abstentions. Leading the report is MEP Lídia Pereira, a member of the center-right European People’s Party in the Parliament.

However, the proposal calls for both a clear definition of crypto assets and what would constitute a taxable event. Certainly, a taxable event is any action or transaction that may result in taxes owed to the government. Nevertheless, the recommendation calls for the taxation of crypto assets to be fair, transparent, and effective. It also invites authorities to consider a simplified tax treatment for occasional/small traders and small transactions.

Regarding a taxable event, the proposal considers converting a crypto asset into a fiat currency as a more appropriate choice. It identifies blockchain as one of the major instruments that national administrations can use to facilitate efficient tax collection.

According to the resolution, blockchain’s unique features could offer a new way to automate tax collection, fight corruption, and better identify ownership of tangible and intangible assets, thus allowing for better taxing of mobile taxpayers.

The proposal calls on the EU regulators and member states to better integrate the use of blockchain into different programs dealing with taxation and cooperation in the field. Member states should also enhance efforts to reform their tax authorities through their modernization efforts, the proposal further urged.

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