Recently, Ukraine’s Digital Transformation Ministry announced that a bill to modify the Tax Code of Ukraine and other laws related to tax assessment for crypto transactions, has been presented in the parliament, Verkhovna Rada.
The agency’s press service recently said,
“The bill was developed by the blockchain community, the Blockchain4Ukraine inter-factional parliamentary association, the Better Regulation Delivery Office (BRDO), and the Digital Transformation Ministry’s team.”
Also, the bill summarizes important taxation features:
- “The first feature is a 5 percent tax rate on personal income for investment profit from the sale of crypto assets for a five-year period,” stated the press service.
- The second feature is identified with the calculation of investment profit derived from crypto-asset transactions.
- The third feature is from the sales of crypto assets that are not liable to VAT (Value Added Tax).
The report further stated that,
“We are confident that the adoption of this [draft] law will create conditions for the launch of the virtual assets market in line with the legislation of Ukraine, taking into account the balance of interests of entities engaged in transactions with virtual assets and the state, which will get additional tax revenue from such transactions.”
Besides, it is evaluated as a positive adjustment between the incomes received from the taxpayer with the sale of the crypto asset and its value, which can be calculated from the documented expenses for the procurement of a crypto asset or potentially its creation.
In spite of significant cryptocurrency activities in the nation, the government is not getting any taxes because of the absence of authentic acknowledgment of these currencies. Besides, if the Government implements the plan to legalize the cryptocurrency, any profits gained on the digital currency would be a taxable occasion. If this is the case, then crypto-related operations will add to the country’s GDP and henceforth will positively affect the economy.