Lawmakers in the European Union parliament voted overwhelmingly in support of the eighth iteration of the Directive on Administrative Cooperation (DAC8), a cryptocurrency tax reporting rule, in a plenary session on Sep. 13.
Held in Strasbourg, France, the session reportedly saw DAC8 receive overwhelming support in the form of 535 member votes for and just 57 against. The measure received 60 abstentions as well.
Heads up: The European Parliament plenary adoption of the #DAC8 is happening today
What are your thoughts on the DAC8 adoption? pic.twitter.com/YRFZSBJYwp
— European Crypto Initiative (@EuCInitiative) September 13, 2023
According to E.U. documents, DAC8 is meant to empower tax collectors with the authority to track and assess all cryptocurrency transactions conducted by organizations or individuals within the Union:
“On 8 December 2022, the European Commission proposed to set up a reporting framework which would require crypto-asset service providers to report transactions made by EU clients. This would help tax authorities to track the trade of crypto-assets and the proceeds gained, thereby reducing the risk of tax fraud and evasion.”
The Sep. 13 plenary session vote was the final hurdle ahead of DAC8’s passage. Going forward, E.U. member states will have until Dec. 31, 2025 to implement the rules ahead of it officially going into effect on January 1, 2026.
As Cointelegraph previously reported, DAC was approved in May, 2023 after the passage of the Markets in Crypto-Assets (MiCA) legislation. The “8” in the updated program’s title refers to its eighth iteration with each prior standing directive addressing a different facet of financial oversight.
In its current form, DAC8 adheres to the Crypto-Asset Reporting Framework (CARF) and the legislation outlined in MiCA and, ostensibly, covers all E.U.-based cryptocurrency asset transactions.
Related: MiCA: The good, the bad and the ugly of the EU’s crypto rules
Some DAC8 critics have opined that it contains little to differ itself from CARF and takes oversight ability away from individual member states.
Max Bernt, chief legal officer at Blockpit, wrote in an analysis earlier this year that such sweeping change “concerns in particular the obligation of (Reporting Crypto Asset Service Providers) to determine on a case-by-case basis whether a transferred crypto-asset is reportable or not.” They also expressed concern over possible “duplicate reporting” as lawmakers attempt to disentangle existing regulations with those planned for implementation.