Switzerland's Focus on Privacy Conflicts with International Efforts for Crypto Taxation

Switzerland Delays Crypto Tax Data Sharing Until 2027

Switzerland has decided to postpone the exchange of cryptocurrency tax information with other countries until 2027. This decision comes as part of a larger international movement to bring digital assets under stricter regulatory oversight. While Switzerland takes a cautious approach, nations such as the United States are moving quickly to implement new frameworks aimed at closing tax gaps related to offshore crypto holdings.

The U.S. Treasury is advancing the adoption of the OECD's Crypto-Asset Reporting Framework (CARF), which is designed to streamline the automatic exchange of information on foreign-held crypto accounts. The United States plans to incorporate CARF into its legal system by 2029, with draft regulations currently under review by the White House Office of Information and Regulatory Affairs.

Key Features of CARF

• Foreign crypto exchanges, brokers, and custodial wallet providers will be obligated to disclose detailed data about U.S. account holders, including asset valuations, transaction records, and personal identification details.
• This system is modeled after the Common Reporting Standard (CRS) used for traditional bank accounts, aiming to close loopholes in tax reporting for digital assets.
• Reportable digital assets are broadly defined as those used for payments, investments, or trading, but central bank digital currencies and regulated e-money products are excluded.

If enacted, the U.S. proposal would significantly expand the IRS’s ability to monitor offshore crypto assets. Currently, the IRS does not have automatic access to information about Americans’ foreign crypto holdings, which can lead to tax evasion. Under CARF, service providers would need to identify U.S. taxpayers and report key metrics such as fair market value and total transaction proceeds.

Switzerland's Position and Global Implications

Switzerland’s decision to delay similar measures may be influenced by ongoing debates about how to balance client privacy with international regulatory expectations. As a major center for wealth management, Switzerland has traditionally emphasized confidentiality, which could complicate its alignment with global tax standards. Nonetheless, the U.S. initiative highlights the increasing pressure on countries to synchronize their rules as digital assets become more mainstream.

Shifting Global Regulatory Landscape

Other countries are also adjusting their strategies in response to technological and economic changes. For example, Canada has recently eased climate regulations to support its oil sands sector, signaling a shift in policy priorities. Meanwhile, Mexico has unveiled plans to construct the region’s most advanced supercomputer, reflecting a commitment to AI-driven economic development. These examples underscore the complex challenges governments face as they adapt traditional regulations to new technologies.