A new Cayman crypto reporting framework is to be implemented by 2027
A joint statement by 48 countries on 10 November 2023 announced that they will be committing to implement the OECD crypto asset reporting framework ("CARF") by 2027.
The CARF rules outline the scope of covered crypto assets, entities, and individuals subject to reporting and data collection requirements, transaction reporting criteria, due diligence procedures and relevant tax jurisdictions for exchange of information and reporting.
The OECD said in a CARF report that the framework was needed because “the current scope of assets, as well as the scope of obliged entities, covered by the Common Reporting Standard (CRS), current standards, do not provide tax administrations with adequate visibility on when taxpayers engage in tax-relevant transactions in, or hold, relevant crypto assets.”
The framework aims to achieve sufficient visibility on tax-relevant crypto asset transactions by collecting and exchanging information on transactions related to crypto assets annually; and intends to transpose CARF into domestic law and activate exchange agreements in order to commence exchanges, by 2027.
Carve-outs are included for assets that cannot be used for payment or investment purposes and for assets already fully covered by the CRS.
The announcement notes that the group of countries recognises that timely and consistent implementation of CARF is necessary to ensure that global tax transparency achievements are not eroded through the growth of global cryptoasset markets.