European Parliament Call For Using Blockchain To Fight Tax Evasion
The European Parliament approved a resolution that operates as a crypto-focused double whammy, addressing both tax evasion through crypto-assets and simplifying taxes procedures.
The resolution attempts to define what constitutes a taxable event and proposes that converting bitcoin to fiat cash is the most practical approach. The European Commission has yet to define these and other potential taxable occurrences and is taking into account the transnational character of crypto-assets.
Cross-national tax administration will need to trade information on crypto-assets in order to exchange taxpayer information. However, the proposal also advocates for simpler taxation on smaller transactions.
According to the European Parliament’s release, blockchain technology is also being promoted as a tool for tax collection, highlighting the technology’s potential to automate tax collection, limit corruption, and better identify ownership of tangible and intangible assets, allowing for better taxing mobile taxpayers.
The Commission is being asked to include blockchain technology in taxation initiatives. It also urges EU member countries to overhaul their tax administrations.
The item was approved by an overwhelming majority of 566 votes in favor, 7 votes against, and 47 abstentions in Parliament’s plenary session. MEP Ldia Pereira, a member of the center-right European People’s Party in the European Parliament, is leading the report.
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