Kazakhstan collects $7 million in crypto mining taxes in 2022 as new regulations take effect

According to local media reports, the Kazakhstan government collected 3.07 billion tenges (around $7 million) in tax payments from crypto mining entities in 2022 after implementing a revised law governing the financial obligations of mining cryptocurrencies.

However, preliminary government data for 2023 show that mining fees collected by April 27 amounted to only 240 million tenges (over $541,000), which is much lower than the 652 million tenges (~$1.5 million) paid in Q1 2022.

Kazakhstan is among the world’s leading Bitcoin mining centers, contributing 13.22% of the total Bitcoin hash rate in January 2022, just behind the United States and China, according to the Cambridge Centre for Alternative Finance data.

To address the undertaxed use of the national power grid by crypto miners, the country introduced taxes on digital mining based on electricity consumption by mining entities, which came into effect on January 1, 2022. The amended law was also seen as a legal path for further adoption amid tightening global regulations.

During the 2021 bull market, foreign mining operators moved to Kazakhstan, straining relations between the country and miners.

To curb tax fraud and unlawful business operations, the government has recently unveiled new crypto regulations, including a proposal requiring miners to sell at least 75% of their crypto earned via registered exchanges and government approval for secured digital asset issuers.

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