According to a recent report by a local Russian publication, Kazakhstan’s ministry of economy has proposed a new tax plan requiring crypto mining companies to file an application for registration with the authorities. After registering, the taxpayer must then indicate the 15% tax on their annual tax calculations. The report further notes, “the clause on registration makes the bill unique… the taxpayer working with cryptocurrencies stands apart from the very beginning of filing a tax return.”
The tax money will be used to fight the pandemic.
Funds raised from the draft tax will be channeled toward building the infrastructure that is needed to fight the ongoing pandemic while also giving the economy a boost. According to the official data, the virus outspread has so far killed nearly 1,300 Kazakhs, with more than 100,000 infected. According to the crypto research company Bitooda, the former Soviet state in central Asia, accounts for about 8% of the global bitcoin hashrate total. Together with Iran and Russia, Kazakhstan boasts the world’s third-largest bitcoin mining industry. Crypto miners are typically drawn to Kazakhstan because of the cheap electricity, which averages 3 cents per kilowatt-hour.
Kazakhstan is targeting up to $738 million of investment from crypto.
Earlier this year, the Kazakh Minister of Digital Development, Innovation, and Aerospace Industry, Askar Zhumagaliyev, revealed that a total of 14 bitcoin mining companies were operating in the country’s north. Over the next three years, the country is targeting up to $738 million of investment from crypto-related activities, particularly mining, he further revealed. The Kazakhstan government is also planning to introduce legislation to regulate the cryptocurrency industry. The new proposed laws are expected to set new electricity tariffs for the crypto mining sector. Currently, China is responsible for the majority of bitcoin mining.