The Country at War with Russia Will Heal Its Wounds with Crypto: Tax on Income Like Airdrop! - Coin Bulletin

Ukraine's financial regulatory authority plans to assess cryptocurrency transactions under personal income tax, while it may offer special tax advantages for stablecoins tied to foreign assets.

The Ukrainian National Securities and Stock Market Commission (NSSMC) raised the issue of evaluating cryptocurrency transactions under personal income tax in a new tax draft published on Tuesday. Commission Chairman Ruslan Magomedov stated that a fair and transparent tax system is critical in terms of preventing the misuse of digital assets and promoting responsible use.

According to the draft plan, in cases where cryptocurrency transactions other than stablecoin are converted to fiat money or used in exchange for goods and services, a 5% war tax will be levied in addition to the standard personal income tax of 18%, as long as there is no loss from the transactions. However, transactions from crypto to crypto will be exempt from taxes, similar to crypto-friendly regions such as European countries and Singapore.

According to the current tax laws in Ukraine, it does not tax income obtained from foreign currency transactions. NSSMC therefore proposes a tax exemption or a low-rate special tax between 5 and 9 percent for stablecoins and similar assets based on foreign assets.

The commission also stated that while considering mining activities as commercial activities, staking income can be taxed as operating income or only when converted to cash. It was suggested that hard forks and airdrops could be taxed either like normal income or only when converted to cash.

Ukraine has prepared a draft law on crypto taxation in 2023. According to the analysis by Global Ledger dated 2024, it was stated that it could provide more than 200 million dollars in annual tax revenue from crypto transactions. The regulations aimed at the crypto sector, legalized by President Zelensky in 2022, continue to be developed based on the European Union's MiCA regulation.