Kazakhstan acted as the escape for the Bitcoin miners in China after the country’s clampdown on mining activities late last year. However, now Kazakhstan is reportedly planning to issue new taxes that can impact the crypto industry negatively.
On April 14, the Minister of National Economy, Alibek Kuantyrov, said in a government briefing that his team is working on a tax plan that would link tax payments to the valuation of the mined tokens.
Alibek Kuantyrov, the minister of National Economy, in an official statement on April 14 that it is creating a tax architecture under which payments and the valuation of the mined tokens will be linked.
This move, as per the statement from Kuantyrov, aims to financially assist the country in tax collections, enhancing the state budget.
This decision also means that many miners can migrate to countries with more mining-friendly regulations such as El Salvador. El Salvador levies a 10% mining tax for facilitating the services and construction of Bitcoin city.
As witnessed earlier, the stance of the Kazakhstan government was miner friendly, however, it changed a few months later.
Once a country that has the cheapest energy in the world for mining, now has introduced a mining tax of 20 cents per kWh in a just month, giving the argument that energy demand has grown among miners.
In addition, the country is also closing down several mining farms, creating more problems and destroying a so-called paradise for miners and the whole Bitcoin mining industry.
Co-founder of Cryptocurrency Mining Group (CMG), Denis Rusinovich denounced the regulatory measures by the Kazakhstan government. CMG is a firm running since 2017 in Kazakhstan. Rusinovich commenting on the latest regulations said, the country “went from being heroes to nothing.”
Are There More Taxes?
Director of Kazakhstan’s National Association of Blockchain and Data Center Industry, Alan Dorjiyev in a press release said the government is planning to charge an energy tax correlated to the price of bitcoin.
Dorjiyev explains that they are considering a gradation, for instance, “up to $40,000 [bitcoin price] one tax, over $40,000 another tax and so on” however he cleared that no decision is made so far and discussion is at the initial state.
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Andrew is a blockchain developer who developed his interest in cryptocurrencies while his post-graduation. He is a keen observer of details and shares his passion for writing along with being a developer. His backend knowledge about blockchain helps him give a unique perspective to his writing
Source: https://www.thecoinrepublic.com/2022/04/16/kazakhstan-government-to-levy-new-charges-correlated-to-bitcoin-price-on-bitcoin-miners/