Kazakhstan is the biggest country in Central Asia in terms of market capitalization. Moreover, it is among the top ten countries in the world. This Central Asian country was part of the Soviet Union until it ceased to exist in 1991. Kazakhstan’s lawmakers finalized a draft law on crypto taxation.
It is important to mention that Kazakhstan has a bicameral parliament. According to the information, the bill regarding crypto taxation is currently under consideration with the presidential administration. Mazhilis which is the lower house of Kazakhstan’s parliament will discuss this bill in December 2019 based on the preliminary information.
Crypto regulations and local market
The purpose of this law is to establish the legal status of crypto mining as well as rules for its taxation. A legislative analyst from the National Association for the Development of the Blockchain and the Industry of Data Centers of the Republic of Kazakhstan provided useful information.
He explained how this law would apply to the crypto industry. According to Madi Saken, digital assets and cryptos won’t fall under the law. It means that crypto owners do not have to pay taxes. However, when they exchange for fiat money, tax liabilities will apply to this transition. It is not hard to understand how crypto taxation will work in Kazakhstan. For example, a person sells his or her cryptocurrency they will have to pay tax. The money they will receive for the digital currency will be subject to taxation.
Another news is that crypto mining farms would be taxed as in the case of typical data centers.
It is worth mentioning that Kazakhstan’s government is in favor of cryptocurrencies. In 2018, the governor of Kazakhstan’s main financial hub, the Astana International Financial Center (AIFC), endorsed the crypto and blockchain innovation. He noted that there is a need to regulate cryptocurrencies, but AIFC supports the development of digital currencies.
Moreover, in 2019, AIFC with cooperation with blockchain tech giant Bitfury to apply the technology across multiple industries.