Kazakhstan to Increase Bitcoin Mining Tax Rates from 2023
Kazakhstan’s President Kassym-Jomart Tokayev has approved new tax rates for crypto miners – and tax bodies have been instructed to charge miners at a rate of up to USD 0.052 per kilowatt hour (kWh) as of January 1, 2023.
Currently, miners have to pay a flat rate of just over USD 0.002 per kWh consumed. But following a winter that was blighted by crypto mining-related power shortages, the government resolved to force bitcoin (BTC) and crypto miners to pay more.
The government began to bemoan the fact that miners were paying “negligible” taxes on their earnings back in February and last month sought to make changes to the tax code.
The country’s finance ministry argued that in the first quarter of the current financial year, miners paid more than USD 15m in tax.
The new tax measure, which was signed into law by Tokayev on Monday, will operate on a sliding scale. As such, instead of paying a flat rate per unit of energy consumed, users who pay a higher price for electricity will pay a maximum of USD 0.052 per kWH of tax, while consumers who pay less for electricity will pay as little as USD 0.002 per kWh consumed.
As energy prices tend to vary throughout the year, this will mean that as power prices rise in the nation, so too will miners’ tax bills.
Most miners operate in the nation’s capital Nur-Sultan, which was formerly known as Astana.
But there is good news for miners who go off the grid: miners using their own power sources will be taxed at a rate of around USD 0.02 per kWh.
Meanwhile, those who can use renewable power sources in their mining efforts will be obliged to pay tax rates of just 0.002 per kWh.
The government has indicated that it is prepared to crack down hard on illegal and unregistered miners. Earlier this year, it introduced a legal requirement forcing all miners to register with a central body and provide detailed reports on their operations.
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Learn more:
– New Taxes Await for Kazakhstan’s Beleaguered Bitcoin and Crypto Miners
– Another Headache for Bitcoin Miners in Central Asia as Three Countries Hit With Blackouts
– Kazakhstan Teaches Bitcoin Miners a Lesson as Chaos Affects BTC Hashrate
– Kazakh President Says Government Must Make ‘Favorable’ Conditions for Crypto Industry Development
– Kazakhstan Develops New Program to Team Up Crypto Exchanges with Banks
– Kazakhstan Central Bank Exploring ‘Opportunities in Crypto, DeFi ‘Innovation’
