OECD announces plan for new digital currency tax reporting framework

The Organisation for Economic Co-operation and Development (OECD) has announced its plans to issue a new tax reporting framework for digital currency and digital assets, which could impose new reporting requirements on cryptocurrency traders and speculators by 2021.

The OECD, which bridges governments internationally to devise common economic policy solutions, said the new framework would help increase transparency in digital currency trading, and ensure gains were appropriately reported to the authorities for tax purposes.

In a report published earlier this week, the OECD said it was “advancing its work to design a tax reporting framework that will ensure tax transparency with respect to crypto-assets, including the income derived from the sale of such assets.”

The new framework could be implemented by countries across the G20 in strengthening existing laws around disclosures for digital asset transactions, building on efforts dating back to 2018 around building a new model for digital currency taxation.

A communiqué from the G20 Finance Ministers & Central Bank Governors Meeting back in July said the COVID-19 pandemic had accelerated the importance of more effective taxation for digital currency and digital assets.

“We will continue our cooperation for a globally fair, sustainable, and modern international tax system. We acknowledge that the COVID-19 pandemic has impacted the work of addressing the tax challenges arising from the digitalization of the economy. We stress the importance of the G20/OECD Inclusive Framework on Base Erosion and Profit Shifting (BEPS) to continue advancing the work on a global and consensus-based solution with a report on the blueprints for each pillar to be submitted to our next meeting in October 2020.”

“We remain committed to further progress on both pillars to overcome remaining differences and reaffirm our commitment to reach a global and consensus based solution this year.”

The “comprehensive implementation package” is expected to be presented to the G20 in 2021.

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