Kazakhstan Proposes To Form Legal Framework for Crypto

• New bill states miners will have to mandatorily trade on domestic crypto exchanges.
• The draft proposes to impose various taxes on miners’ earnings.
• The focus is on production and circulation of secured and unsecured digital assets.

On Wednesday, the Russian news agency TASS reported that the Majilis or the parliament of Kazakhstan has passed five cryptocurrency bills requiring bitcoin miners to form legal entities and become formal tax subjects.

As per the bill, from 2024, miners will have to mandatorily trade on domestic cryptocurrency exchanges.

Thus, apart from the current equipment import VAT and digital mining fees per kilowatt, the bill puts forward the proposal of imposing taxes including corporate income tax, mining pool income tax, cryptocurrency operating fees, and corporate income tax on miners’ earnings.

Ekaterina Smyshlyaeva, a member of the Committee on Economic Reform and Regional Development of the Mazhilis remarked:

Deputies of the Majilis of the Parliament have developed a sectoral bill on digital assets of the Republic of Kazakhstan and four related bills as a legislative initiative.

Smyshlyaeva further added that draft bills partially address the production as well as the circulation of secured and unsecured digital assets.

Kazakhstan is particularly attempting to create a framework for electricity used for mining digital assets. The guidelines would empower the Ministry of Energy to allocate volume-based quotas depending on the requirement of the electric grid.

Smyshlyaeva elaborated that the bills will also bring in more opportunities to attract investments for the infrastructure of new generations in fields and renewable energy sources. The crypto scene in Kazakhstan has been positive of late, especially with Binance receiving a green signal to create its headquarters in the country and with President Kassym-Jomart Tokayev’s vocal support for cryptocurrencies.