Switzerland is exploring the integration of crypto tax data into its global information exchange systems. The Federal Council initiated a consultation on Wednesday, proposing a bill that aims to share crypto asset information with 111 jurisdictions. These jurisdictions are currently participants in the automatic exchange of information, provided they adhere to the OECD’s Crypto-Asset Reporting Framework.
Leading the Way in Crypto Adoption
Switzerland has long been a frontrunner in cryptocurrency adoption. Cities like Lugano have set an example by accepting taxes in cryptocurrencies like Tether (USDT) and Bitcoin (BTC). Thanks to the country’s political structure, the Federal Tax Administration classifies Bitcoin as a payment method, exempting it from Value Added Tax (VAT).
Federal Council’s Plans for Information Exchange
The Federal Council intends to determine the start date for the automatic exchange of crypto-related data with its partner states. The consultation period for this legislative proposal will close on November 15, 2024. This move reflects Switzerland’s continued leadership in embracing digital assets while ensuring tax compliance and transparency.
Strategic Partnership Considerations
Switzerland is carefully considering which countries to partner with for the automatic exchange of crypto asset information. As part of this process, the Federal Council has initiated a consultation period. The exchanges are anticipated to begin in 2026, marking a significant step towards integrating cryptocurrencies into international tax protocols.
OECD’s Framework Allows National Customization
The OECD’s framework for crypto assets provides a standardized approach for tax authorities to manage and exchange data. However, it also offers flexibility for countries to adapt these guidelines to their specific legal and regulatory environments. This balance ensures a minimum standard of transparency and cooperation, helping to prevent tax evasion while enhancing compliance in the crypto sector.
Switzerland’s Proposed Expansion of AEOI to Cryptoassets
In May 2024, Switzerland’s Federal Council launched a public consultation to extend the automatic exchange of information (AEOI) to include crypto assets. This aligns with global standards set to take effect on January 1, 2026. The consultation period will continue until September 6, 2024. The Federal Council’s proposal details which of the 111 jurisdictions with active AEOI agreements will exchange crypto asset information starting in 2026. Additionally, it considers potential future partners who meet the OECD’s criteria.
Before implementing this automatic exchange, the Federal Council will evaluate whether partner states continue to meet the necessary standards. This review will now include crypto assets, necessitating a comprehensive update of the 2017 federal decree.
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