Nearly 50 nations including the US are collaborating to enable automatic information exchange between crypto trading firms and tax agencies.
In a new press release, the government of the United Kingdom (UK) says that the coalition of jurisdictions is partnering up to create the Crypto-Asset Reporting Framework (CARF) as a means of ensuring tax compliance and combating tax evasion.
“To keep pace with the rapid development and growth of the crypto-asset market and to ensure that recent gains in global tax transparency will not be gradually eroded, we welcome the new international standard on automatic exchange of information between tax authorities developed by the OECD (Organisation for Economic Co-operation and Development) – the Crypto Asset Reporting Framework (CARF).
The widespread, consistent and timely implementation of the CARF will further improve our ability to ensure tax compliance and clamp down on tax evasion, which reduces public revenues and increases the burden on those who pay their taxes.”
Some of the other nations that have joined the effort include Japan, Mexico, Korea, Brazil, Italy, South Africa, Romania, Canada, Spain, Switzerland, Germany, South Korea, France, and Singapore, which committed recently via a press release.
According to a joint statement, the final agreement for CARF was reached earlier this year in March after years of discussions. Furthermore, it states that CARF is set to be implemented by 2027.
“Final agreement on the CARF was reached in March 2023, following two years of negotiation. It will provide for the automatic exchange of information between tax authorities on crypto exchanges for the purpose of combating offshore tax avoidance and evasion.
This statement announces the signatory jurisdictions’ intention to implement the framework in time to commence exchanges by 2027.”
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