According to a local media report, Kazakhstan’s lower house of parliament, Mäjilis, has embraced a new crypto bill called “On Digital Assets of the Republic of Kazakhstan.” Also, the government has adopted four crypto-related draft legislations.
These regulations aim to regulate the crypto mining industry in Kazakhstan and token issuance and circulation. Once a hub for crypto miners, Kazakhstan has become a shadow of itself with its latest regulations. The country has blamed crypto miners for its vast power deficit.
According to the country’s latest legislation, crypto miners in Kazakhstan can only purchase electricity from the government if it has a surplus. Hence, crypto miners cannot buy power in periods of shortages.
Meanwhile, all purchases will occur via the nation’s centralized power market, the KOREM exchange. The local media outlet, Tengrinews, quoted Ekaterina Smyshlyaeva, a member of the Mäjilis, saying that market mechanisms will govern electricity transactions.
Additionally, the bill unveiled two new categories for crypto mining licenses. The first category is for companies that run facilities like data processing centers.
However, such entities must meet specific security, location, and equipment standards. The second category is for owners of crypto mining hardware who operate on crypto farms and have no energy quota.
Mining pools will be subject to more rules than other crypto entities. First, Smyshlyaeva said the servers of these miners must be located in Kazakhstan and follow local regulations.
Crypto Miners Will Pay Corporate Tax
Furthermore, the authors of the current law also considered taxation for crypto miners. This means that crypto mining firms will have to pay corporate income tax.
This tax is calculated according to the value of the crypto received as a reward. Similarly, mining pools will pay taxes depending on their commission.
The report further stated that individuals who conduct crypto transactions would have to pay value-added tax (VAT). However, the information did not specify the exact rate for the taxes.
Likewise, companies offering cryptocurrency exchange services must pay corporate tax. According to Smyshlyaeva, Kazakhstan prohibits the exchange and circulation of digital currencies.
Still, trading platforms can offer crypto services under the Astana International Financial Center (AIFC) supervision. Also, training platforms must receive a license from the agency.
However, they will not enjoy the tax benefits available to other registered firms. The government also intends to prohibit the promotion of digital currencies in the country.
These regulations are similar to those that govern securities. Also, the government added that it would only allow the issuance and circulation of digital assets if they have collateral.
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