Kazakhstan Ignites Digital Fever

Kazakhstan Ignites Digital Fever: Green Light for Cryptocurrency Miners with Reduced Costs

Amendments have been made to the tax legislation of Kazakhstan aimed at supporting cryptocurrency miners

Kazakhstan is taking steps to improve the conditions for the development of the cryptocurrency industry in the country, in particular for mining companies. This was the result of close cooperation between the Kazakhstan Association of Blockchain Technologies and Data Centers with government institutions and the legislature.

The consequence of the six-month dialogue was the approval and signing by the President of Kazakhstan Kassym-Jomart Tokayev of the draft law on December 12. The document introduces significant amendments to the tax code, thereby favorably affecting the economic prospects of the mining industry in the country.

Since the beginning of 2024, a fixed electricity tariff for mining has been introduced. Thus, the price for 1 kWh will be reduced to the level of 2 tenge, which is significantly less than the previous duty of 26 tenge. Miners using their own generating capacities are offered an even lower tariff — 1 tenge per kWh, while previously they paid 10 tenge.

In addition, the innovations also affect the sphere of operations with digital assets. Crypto exchanges registered in Kazakhstan are exempt from VAT when performing transactions with cryptocurrencies. This measure is designed to strengthen the position of local platforms in the global financial market, as noted by Dauren Karashev, head of the Kazakhstan Association of Blockchain Technologies.

The Association intends to continue advocating for the interests of the crypto industry, striving to increase its transparency and to remove obstacles hindering the development of the industry in Kazakhstan.

The impact of mining on the country's economy is significant, which is confirmed by statistical dаta: in 2022, the industry brought about 3.07 billion tenge (approximately 7 million US dollars) to the budget. Previously, mining companies paid attention to high tax rates, turning to the president for benefits, as they feared for their own future in the face of tightening legislation. The adopted changes are aimed at supporting and developing this important area for the economy of Kazakhstan.