Kazakhstan Won’t Tax Cryptocurrency Mining: Report

Kazakhstan’s lawmakers won’t be taxing cryptocurrency mining until the mined crypto is exchanged for fiat money. According to a legislative analyst at a local blockchain association, cryptocurrency mining will not be treated as entrepreneurial activity but rather a “purely technological progress,” local business publication Kursiv reports Dec. 4.

Madi Saken, legislative analyst at the National Association for the Development of the Blockchain and the Industry of Data Centers of the Republic of Kazakhstan, reportedly announced the news at a local blockchain event “Blockchain Day” on Dec. 4.

Cointelegraph has contacted the association for comment on the report by Kursiv but the organization hadn’t replied as of press time.

Tax liabilities only apply to income in “real money”

According to the report, Kazakhstan’s lawmakers have finalized a draft law on crypto taxation. The bill is currently under consideration with the presidential administration. The bill will reportedly be sent to the Mazhilis, the lower house of the bicameral Parliament of Kazakhstan, in December 2019.

Specifically, the proposed law will establish the legal status of crypto mining as well as rules for its taxation. According to Saken, digital assets and cryptos won’t be considered as subject to taxation because tax liabilities only apply to the income made in “real money.” As such, taxes will only be applicable when cryptocurrency is exchanged for fiat money. Saken elaborated:

“Tax liabilities only emerge when there is an income in the form of real money, particularly when a cryptocurrency is exchanged for real money, which means it is sold on an exchange. Then, this income in the form of classic money will be subject to taxation.”

Mining farms would be taxed by analogy with data centers

However, crypto mining will still be deemed entrepreneurial activity in cases when entities offer services to use their crypto mining hardware, the executive reportedly stated. Mining farms would reportedly be taxed by analogy with typical data centers, the report notes.

Kazakhstan’s government has taken a positive stance towards crypto and blockchain so far.

In 2018, the governor of Kazakhstan’s main financial hub, the Astana International Financial Center (AIFC), claimed that crypto and blockchain innovation will be supported despite the need to regulate cryptocurrencies. In May 2019, the AIFC partnered with blockchain tech giant Bitfury to cooperate on blockchain applications across a number of industries.

Andreas Antonopoulos Slams Intuit After Payments Block for Crypto Use

American financial software company Intuit has apparently limited the account of one of the cryptocurrency industry’s best-known figures, Andreas Antonopoulos

In a series of tweets on Dec. 4, Antonopoulos stated that Intuit had prevented him from accepting credit card payments via its accounting services due to his use of cryptocurrency. 

According to Antonopoulos, who undertakes regular international tours as a speaker and educator on Bitcoin (BTC) and associated topics, the company even requested he stop referencing cryptocurrency on his official website. Commenting on the events, he appeared to refuse to comply:

“Intuit Merchant Services @intuit just told me that I can’t be using crypto if I accept credit cards for my invoices. They asked me to remove crypto from my site. I instead elected to remove Intuit and their credit card services from my life.”

Continuing, he added that Intuit had “disabled” the option for him to accept credit card payments for his activities.

Antonopoulos is a fierce critic of traditional finance, often explaining to audiences how banks stand to lose to Bitcoin and new standards of individual financial sovereignty. He tweeted today, “The banking cartel doesn’t want competition or risk. They prefer monopolies, kleptocracy and captured regulators.”

Banks force Bitcoin bans

As Cointelegraph reported, certain payment entities continue to adopt a seemingly random policy on cryptocurrency clients. This week, a Danish court ruled in favor of Nordea Bank continuing to prevent its employees from holding cryptocurrency, triggering accusations of hypocrisy from online commentators. 

Nordea’s stance echoes those previously adopted by other banks, including Dutch institution Rabobank. The latter denied service to cryptocurrency businesses, having faced criminal proceedings over fiat money laundering. 

Last month, adult entertainment website Pornhub found payments to its 100,000 web models disrupted after PayPal suddenly refused to service the business. The website began a deal with cryptocurrency project Verge (XVG) last year.

In an ironic twist, U.S. lender Bank of America subsequently closed the account of a former senior PayPal executive. 

Cointelegraph has approached Intuit for comment but has not received a response at press time.

British Virgin Islands Announce US Dollar-Backed Digital Currency

Blockchain startup LifeLabs announced that it is developing a digital currency dubbed BVI~LIFE in partnership with the British Virgin Islands (BVI).

According to a press release on Dec. 3, the currency is part of a broader initiative to grow the local fintech sector and will be presented during the BVI Digital Economy symposium. 

The coin will be a stablecoin pegged 1:1 to the U.S. dollar — which the BVI have used since 1959 — and its use is expected to reduce transactional fees, increase transaction speed and be accessible to outsiders such as tourists. 

LifeLabs is also developing Rapid Cash Response, a fund meant to provide aid in case of a national emergency. The local government already announced this initiative in April. BVI Premier Andrew Fahie said:

“The importance of blockchain technology and the significant benefits it offers the BVI, are paramount to the Territory. We welcome this innovation with open arms. Our partner, LIFElabs, has demonstrated with their proven track record that their ideology is not just mere words, and we look forward to continuing our partnership with them on the rollout of BVI~LIFE, our digital currency.”

According to cryptocurrency data website Coin360, the Life token’s price increased by nearly 31% over the last 24 hours, reaching $0.000083.

While the BVI may be considering a dollar-pegged stablecoin, the Marshall Islands are developing a token in an effort to move away from the United States’ fiat currency. Earlier this year, officials announced that the Pacific island nation would develop a digital Sovereign that would be easily transmittable over the many islands that make up the country.

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