Kazakhstan to propose new tax regime for cryptocurrencies
The Minister of National Economy of Kazakhstan reported on the work he has been doing to introduce a new tax regime for cryptocurrencies
Kazakhstan’s Minister of Economy, Alibek Kuantyrov, explained that the government is working on a new tax regime that aims to increase taxes on activities related to cryptocurrency mining. As well as “its intention to link the new rate to the value of the minted cryptocurrency”, as a measure to increase income to the national treasury.
The economy minister noted: “We are considering increasing the tax burden for miners, at the moment we are also considering linking the tax rate for miners to the value of the cryptocurrency. If cryptocurrency grows, it will be good for the budget.”
As will be remembered, Kazakhstan has established itself as an important mining center on a global level after miners migrated from China to other countries. However, the eastern country’s policy towards miners is changing drastically and if the government continues with that plan, “miners in Kazakhstan will see their taxes grow along with the value of the digital assets they are extracting.”
Mining companies were recently forced to pay more for energy service than most consumers, due to the rising cost of energy use in the country, which rose to 10 Kazakh tenge (approximately 0.0022 dollars) per kilowatt-hour (kWh) of electrical energy. In addition, other mining stations had to close because the government cut off their electricity service.
Criticism of new fiscal policies
Uncertainty and criticism over fiscal policies began when Kazakhstan’s President Kassym-Jomart Tokayev ordered agencies to increase taxes on spaces used by miners.
The president also determined that the country’s financial entities had to verify “the customs and fiscal documents of all the country’s mining facilities to guarantee compliance with their fiscal regime.”
Cryptocurrency Mining Group co-founder Dennis Rusinovich said that Kazakhstan “has gone from being a hero to a zero, despite the mining community establishing a new sector in the country and building a strong global position as a Bitcoin mining hub.”
For his part, Alan Dorjiyev, director of the National Association of the Data Center and Blockchain Industry of Kazakhstan, considers that there is no such thing as security in the way the new taxes will be structured.
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