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Ukraine Proposes 23% Tax on Crypto Transactions with Stablecoin Exemptions
The National Securities and Stock Market Commission (NSSMC) of Ukraine has proposed a new tax framework for cryptocurrency transactions. The proposal recommends a flat rate of 18% personal income tax, in addition to a 5% military levy, resulting in an overall tax rate of 23%.
The proposed framework would exempt crypto-to-crypto trades and stablecoins from taxation. This means that users will not be required to pay taxes on the conversion of one cryptocurrency for another or on transactions involving stablecoins, which are pegged to the value of a traditional currency.
In addition to these exemptions, the framework also addresses various other aspects of the crypto market, including mining, staking, and hard forks. The NSSMC suggests that these activities could be taxed at different rates, depending on their scope and nature.
One of the key points highlighted in the proposal is the consideration of tax-free thresholds for small investors. This move aims to relieve the burden on individuals with modest holdings, thereby promoting social equity.
The proposed framework has been presented to Ukraine’s parliamentary finance committee as part of a draft legislation. The NSSMC emphasized that it is crucial to establish clear tax guidelines to prevent financial abuse and promote the “legal and responsible use” of digital assets.
Ukraine’s move follows a broader trend in Europe, where countries are grappling with how to regulate their crypto markets. This development marks an important step towards creating a comprehensive regulatory framework for Ukraine’s virtual asset market, which has significant potential to contribute to the country’s economy.
It is worth noting that the proposed tax framework aligns with European Union (EU) standards. As a candidate member of the EU since 2022, Ukraine aims to harmonize its regulations with those of the EU, particularly with regards to financial markets.
In related news, OpenSea has requested an exemption from SEC rules for NFT marketplaces, while the EU’s Markets Regulator warned that crypto could have a negative impact on financial stability.
Source: https://blockonomi.com/ukraine-proposes-23-tax-on-crypto-transactions-with-stablecoin-exemptions/
