New Crypto Taxation Regulatory Working Group is Being Formed by Ukrainian Finance Ministry
A working group is being put together by the Ukrainian Ministry of Finance to explore avenues for creating a comprehensive framework for crypto taxation. This was revealed on Monday October 8 via an announcement on the ministry’s website.
According to the statement, the working group, made up of legal experts will begin meeting on October 16 with the goal of identifying tax regulations options for the crypto space within the existing legal framework of Ukraine. Its findings will then be delivered to the Expert Council for Preparation of common tax consultations before the end of Q4 2018.
It will be recalled that last month, the Ukrainian parliament known as Verkhovna Rada presented a draft bill on cryptocurrency taxation which proposed among other things a 5 percent tax for individuals and legal entities holding cryptocurrencies.
The draft bill also suggested a tax hike for businesses in the crypto space to 18 percent, effective from January 1, 2024. According to the bill, the new tax regime would net the Ukrainian tax authorities an extra 1.2 billion hryvnia ($42 million) between 2019 and 2024.
Ukraine Develops a Pro-Crypto Stance
Earlier this month, Ukrainian MP Yuriy Derevyanko put forward a draft proposal suggesting the creation of tax exemptions for all cryptocurrency trading entities until 2029. Explaining the reasoning behind the draft bill, Derevyanko reportedly said that the budding cryptocurrency sector needs to be protected s a future growth industry.
“We have to regulate and legalize this segment, which will become an engine for a new economy.”
In addition, the National Bank of Ukraine (NBU) has reportedly started considering a proposal for it to issue a state-backed digital currency tied to Ukraine’s fiat, the hryvnia. According to the NBU, the so-called “e-hryvnia would be centralized unlike a typical cryptocurrency, remaining under full government control.