Taxation of Cryptocurrency in Ukraine

by Roman Cheplyk
Wednesday, December 1, 2021
Taxation of Cryptocurrency in Ukraine

The development of a draft law on taxation of cryptocurrencies and other virtual assets is underway

The Ministry of digital transformation and a group of people's deputies are the developers of the draft law.

What are the existing lines of the bill:

  • Companies conducting operations with cryptocurrencies will pay 5% income tax;
  • Individuals will pay a 10% + 1.5% military fee for operations with virtual assets.

It should be noted that the standard 18% tax on personal income is significantly higher than taxes for working with virtual assets. There is a difference between the purchase price of a virtual asset and the income from its sale. This difference is the object of taxation. There is no value-added tax in this case.

As the authors of the project comment on this:

  • The value of a virtual asset is determined by supply and demand. Such assets have no prime cost, as well as the process of the added value emergence itself;
  • The high turnover rate of virtual assets does not affect their characteristics even if it changes the asset's owner;
  • In countries where these types of assets are legalized, there is no MPE: USA, Canada, Japan, Germany.

This taxation system can be legalized by the end of 2021. At the same time, work is underway on an alternative bill.


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