Switzerland is set to become a trailblazer in crypto tax reporting, as the Federal Council announces plans to adopt the Crypto Asset Reporting Framework (CARF) for global standards. This move aims to ensure equal treatment for traditional assets and enhance tax transparency, aligning with the Automatic Exchange of Information (AEOI) initiative. The consultation period, which began on May 15, will conclude on September 6, gathering public feedback on this significant development.

The Swiss government's move to join AEOI, established by the Organisation for Economic Co-operation and Development (OECD), demonstrates its commitment to combating tax evasion. By implementing CARF, Switzerland will expand its progressive crypto market regulation, maintaining the credibility and reputation of the Swiss financial center. This decision follows the adoption of the OECD's Common Reporting Standard (CRS) in 2014, which excluded CARF. Now, the Federal Council seeks to close the gaps in tax transparency and ensure equal treatment for all assets.

The implementation of CARF will require parliamentary approval and is expected to be fully adopted by approximately 50 countries by 2027. This global cooperation aims to prevent money laundering and ensure tax compliance. Crypto asset service providers, including exchanges, brokers, dealers, and ATM operators, will face new reporting requirements. Individuals and businesses will need to report transactions involving crypto assets with fiat and other crypto assets to the relevant tax authorities.

As Canada also considers implementing CARF for taxation by 2026, Switzerland's move sets a precedent for global crypto tax standards. The consultation period offers an opportunity for public input, shaping the future of crypto taxation. By adopting CARF, Switzerland cements its position as a pioneer in crypto regulation, fostering a more transparent and equitable financial landscape.