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Kazakhstan Imposes Higher Tax Rates On Crypto Miners: All You Need To Know

Electricity usage tax rates for crypto miners in Kazakhstan reportedly start from as low as KZT 1 (roughly Rs 0.17) per kilowatt-hour.

Kazakhstan President Kassym-Jomart Tokayev has signed into law a bill that imposes higher tax rates on crypto miners working in the country. Cryptocurrency mining, as the name suggests, is the process of creating new cryptocurrencies into circulation. A highly competitive process, crypto mining uses a proof-of-work method to verify and add new transactions to the blockchain. As per Kazakhstan’s new Tax Code, the hiked tax will depend on the average price of electricity and the amount used for the mining process, as first reported by Bitcoin.com.

Electricity usage tax rates for crypto miners in Kazakhstan reportedly start from as low as KZT 1 (roughly Rs 0.17) per kilowatt-hour. As mentioned, the exact rate of tax will be determined based on the average price of the amount of electricity used to mine crypto coins. 

ALSO SEE: Is Cryptocurrency Mining Legal In India? Here’s What Experts Say About It

Miners who use renewable energy will pay the lowest tax, at KZT 1 per kilowatt-hour. Last year, the country saw a growing deficit of power. These shortages were largely blamed on the boom in crypto mining in the country, especially after China cracked down hard on crypto miners in 2021. In order to deal with the sudden influx, Kazakhstan imposed restrictions on the supply of electricity during the winter months and even went ahead with temporarily shutting down mining facilities. In February, President Tokayev ordered authorities to identify crypto miners in the country and raise their taxes.

Disclaimer: Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. Cryptocurrency is not a legal tender and is subject to market risks. Readers are advised to seek expert advice and read offer document(s) along with related important literature on the subject carefully before making any kind of investment whatsoever. Cryptocurrency market predictions are speculative and any investment made shall be at the sole cost and risk of the readers.

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