Luxembourg fund industry body backs crypto-assets tax harmonisation
The development of investments in crypto-assets and e-moneys is an innovation that should rely on a level playing field from a tax perspective, said Alfi, Luxembourg fund industry association. The body replied to the latest European Commission consultation on stronger EU tax cooperation through crypto-assets, e-money and tailored compliance measures.
A Markets in Crypto Assets Regulation (MiCA) is expected to come out in 2022 to provide a EU framework as to crypto-asset investments by funds and asset managers.
“As of today, the number of crypto assets initiatives from an asset servicing perspective as well as from an asset management perspective is still quite limited,” noted Alfi. Luxembourg's fund industry association believes all service providers and other financial institutions operating with crypto-assets should have the same reporting obligations for tax purposes throughout the EU in order to “ensure a harmonised approach is taken and a level playing field is created.”
According to Alfi, the main challenges would dwell in the implementation of processes for due diligences to be carried out as well as in the collection of information required that are not already collected hitherto for the purpose of other legislations.