TL;DR Breakdown
- Kazakhstan signs crypto mining taxation into law; to commence in 2022.
- The crypto mining market becomes the next prey for government regulations.
- Taxation rules could become the death of Kazakhstan’s crypto mining space.
Tax rules for crypto miners in Kazakhstan – A business perspective
The government of Kazakhstan has put forward a new taxation law for the country’s crypto mining sector – a decision that has raised eyebrows among businesses. According to a government communique, the bill was signed last month and is set for enactment from January 1, 2022.
The authorities of the Central Asian country expect the new regulation to generate several billions of Kazakhstani tenge for the national treasury. However, reports in the media speculate that several businesses have started demurring the taxation law, citing that the move could potentially cripple the country’s budding crypto mining sector.
Kazakhstan becomes the newest member of the league of countries like Iran who have imposed taxes on the crypto mining sector.
The upturn of crypto miners in Kazakhstan is due to the clampdown in other nations like China which has adopted a dissimilar approach instead of taxation.
Miners fleeing to Kazakhstan will now have to consent to taxation rules resentfully – at least the energy environment supports their activities and offers comparatively inexpensive electricity.
Is the Crypto mining market the next stop for regulators?
The crypto market is rapidly drawing the attention of governments and financial institutions across the globe, and regulations are beginning to fly around. In recent times, cryptocurrency exchanges have come on the radar, as seen in South Korea.
The South Korean government has come out with extensive rules of engagement for crypto exchanges operating within its boundaries and demands absolute compliance before granting them a full operating license.
In Canada, KuCoin, Poloniex, and several other exchanges are being investigated for flouting government regulations. Could the crypto mining sector be next?
Of all regulators, China is doing the most by cracking down on miners, and issuing strict instructions to banks to desist from facilitating cryptocurrency-related transactions.
Regardless, the mining industry continues to grow steadily, and financial regulators are watching. Whether the taxation on crypto miners in Kazakhstan evolves into stricter measures remains to be seen. Still, it looks more likely than not as governments continue to push for more regulations in the financial sector.
