Netherlands seeks public feedback on crypto tax rules: report

The Netherlands is seeking public feedback on proposed regulations to track cryptocurrency ownership in a bid to align tax laws with European Union standards.

According to the Dutch Ministry of Finance’s October 24 announcement, the proposed laws would require crypto service providers, including exchanges, to collect, verify and share user data with the Dutch Tax Administration.

This directive, which will come into force on January 1, 2026, is part of the EU’s broader efforts to prevent tax evasion and increase transparency in digital asset ownership. The Ministry of Finance called on crypto service providers and the public to submit their opinions by November 21.

Under the proposed rules, crypto providers must make user data available to residents of EU member states; The Dutch Tax Administration will then share it with other tax authorities across the EU in accordance with the DAC8 directive on crypto tax reporting adopted by member states last year.

DAC8, implemented by the EU on October 17, 2023, requires all crypto service providers in the EU to report user data to the tax office of the country in which they are registered. This framework is designed to ease administrative burdens, as providers only need to notify once in the EU member state in which they are located.

Without this directive, providers may face multiple data requests from each EU country, increasing the administrative burden on crypto service providers.

Also in November 2023, the Netherlands adopted the Organization for Economic Co-operation and Development’s Cryptoasset Reporting Framework, which mandates the automatic exchange of information between the tax authorities of participating countries.

The proposed Dutch legislation would therefore ensure that data collected under CARF is also shared with non-EU jurisdictions that adhere to the framework.

Minister of State for Taxation and Tax Administration Folkert Idsinga said the bill represents “an important step in the taxation of cryptocurrencies”, adding that advanced data sharing mechanisms will help prevent tax evasion and prevent EU governments from losing tax revenue. crypto assets.

Public feedback gathered through the consultation will contribute to the final version of the bill, ensuring it meets both EU standards and Dutch tax policy objectives. The Ministry of Finance plans to submit the bill for consideration by the House of Representatives by mid-2025.

Regulations in the EU

The Netherlands joins Denmark in complying with EU crypto tax standards. On October 23, Denmark proposed a bill to tax unrealized gains in crypto, which, like the Dutch proposal, complies with DAC8 and CARF standards.

In this environment, the European Union has stepped up efforts to create a unified regulatory framework for the crypto sector across member states, with the adoption of Crypto-Asset Markets (MiCA) legislation considered a key priority.

As part of this effort, member states are also developing their national legislation to comply with MiCA. For example, Irish regulators are considering drafting urgent legislation to update Ireland’s regulations ahead of MiCA implementation, while Spain planned early implementation.

MiCA is scheduled to come into force on December 30, 2024.