Series on International Taxation

Crypto Tax Transparency: Crypto Assets and Exchange of Information for Tax PurposesThomas Dilen The breakthrough of crypto assets into the mainstream and their increasing entanglement with the real economy have led both loyal admirers and staunch sceptics to agree that cryptocurrencies are here to stay. However, the fact that crypto assets rely on blockchain technology poses entirely new challenges to tax compliance and transparency. This important and timely study is the first to critically analyse whether the international standards for the exchange of information in tax matters are adequate to cover crypto assets and to cope with their inherent challenges. In the course of the analysis, the author examines and clarifies various aspects related to crypto tax transparency, including: how the pseudonymity, decentralization, and lack of a clear situs of blockchains and crypto assets pose significant challenges to tax transparency; a taxonomy of crypto assets and their service providers; the substantial tax treatment of crypto assets and crypto-related activities in selected jurisdictions; the relevant inter- and supranational binding legal instruments and non-binding models on exchange of information in tax matters; what information on crypto assets should be subject to exchange of information procedures; treatment of crypto asset users rights as taxpayers involved in exchange of information procedures; whether the Global Forum s standard of exchange of information on request (EOIR) is still able to cope with the new phenomenon of crypto assets; the roles of the OECD s Crypto-Asset Reporting Framework (CARF) and the EU s Directive on Administrative Cooperation (DAC) in enabling automatic exchange of information (AEOI) on crypto assets; potential role of the Foreign Account Tax Compliance Act (FATCA) and the US Treasury regulations governing broker reporting on digital assets.With regard to the substantial tax treatment of crypto assets and the national procedures on exchange of information in tax matters, Switzerland, Belgium, and the United States have been chosen as representative national jurisdictions on the basis of their contrasting policies on crypto assets and their particular legal contexts. With its extensive treatment and thorough guidance on rules, principles, and procedures regarding exchange of information in tax matters at international, EU, and national levels and how to apply them to crypto assets this book will help practitioners and administrations to proceed confidently through the maze of rules that govern the international framework of exchange of information and to enhance tax compliance and proper reporting among both crypto asset users and crypto asset service providers.