OECD calls for global crypto tax framework
A report to the G20 advocates cooperation and identifies new tasks to be undertaken without delay.
The Organization for Economic Co-operation and Development (OECD) has informed the G20 that international tax regulations must be examined and adjusted to encompass cryptocurrencies and associated technologies.
In the OECD Secretary-General’s Report to the Group of 20 Economies (G20) finance ministers and central bank governors, the international organization explains the impact of digitization on tax policy and administration.
“Technologies like blockchain give rise to both new, secure methods of record-keeping while also facilitating cryptocurrencies which pose risks to the gains made on tax transparency in the last decade,” the report said.
“Some work is already underway to better understand and address these developments, but further work is required to ensure that governments can harness the opportunities these changes bring while ensuring the ongoing effectiveness of the tax system. It will also be important to give specific consideration to how advances can be implemented in developing countries to take into account their particular circumstances.”
The report identifies new tasks to be “undertaken without delay”. The OECD advocates that international cooperation among tax administrations should be enhanced to “ensure taxes are paid when they are due”.
The Forum on Tax Administration, established in 2002, together with the Inclusive Framework on BEPS (Base erosion and profit shifting), will “develop practical tools and cooperation” for tax administration. These groups will be specifically targeting cryptocurrencies and distributed ledger technology (DLT) a.k.a blockchain.
The tax framework will be updated in 2019, before being introduced by 2020, according to the OECD’s report.
This week, finance ministers and central bank governors at the G20 Summit declared that they don’t consider cryptocurrencies to be currencies at all, but rather assets, calling for continued monitoring and reviews.
In a press conference following the meeting, Argentina’s treasury minister Nicolás Dujovne revealed that the G20 “received a strong mandate that it’s [crypto assets] an issue to be closely looked at.” He said that regulation, markets, cybersecurity, data, transactions, security, money laundering and more were discussed.
Earlier this week, the Financial Stability Board (FSB), a global regulatory body that monitors financial susceptibility for the G20, determined that the burgeoning cryptocurrency industry is not currently a liability to global financial stability. However, the FSB said crypto assets do require further observation and investigation.
The FSB plans to identify enhanced metrics and tools to fill any existing or future cryptocurrency data gaps.
The G20 Summit 2018, held in Buenos Aires March 19-20, addressed issues such as international financial architecture, the global tax system, financial regulation, plus cryptocurrencies and supported technologies.
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