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Ukraine has proposed a 23% crypto income tax, with stablecoins potentially exempt from the new law. The proposal was released by the National Securities and Stock Market Commission (NSSMC) on April 8.
The draft suggests that cryptocurrency income should be taxed when digital assets are converted into fiat currency or used for goods and services. This would result in a total tax rate of 23%, comprising an 18% income tax and a 5% military levy.
Stablecoins, which are pegged to the value of a foreign currency like the US dollar, could be partially or fully exempt from the new law. The NSSMC stated that stablecoins should not be treated the same as volatile crypto assets due to their backing by fiat currencies.
The proposal also outlines options for crypto mining and staking. Crypto mining is considered a business activity, with a possible tax-free threshold for small-scale miners or occasional transactions. Staking rewards could be taxed only when converted into fiat currency, allowing users to avoid paying taxes until they cash out.
The document highlights the difficulty in enforcing taxes on non-custodial wallets like MetaMask and hardware wallets due to their lack of third-party verification. The NSSMC emphasized the need for a balance between enforcement and fairness in tax rules.
Ukraine first introduced regulations for digital assets with President Volodymyr Zelenskyy signing a law to establish a regulated crypto market in March 2022. This new proposal aims to complete the legal framework by providing clear tax rules for cryptocurrency income, mining, staking, and airdrops.
It is unclear when the Ukrainian Parliament’s tax committee will finalize the legislation. However, the NSSMC’s proposal provides a detailed roadmap for regulating these activities, allowing lawmakers to shape the final tax structure.
Source: https://coinchapter.com/ukraine-pushes-23-crypto-income-tax-stablecoins-may-get-exemption/?utm_source=rss&utm_medium=rss&utm_campaign=ukraine-pushes-23-crypto-income-tax-stablecoins-may-get-exemption
