The government of Kyrgyzstan has announced that it has raised over $1 million in cryptocurrency mining taxes in the first nine months of 2023. According to the Kyrgyz Ministry of Finance, the funds were received as part of a special tax on cryptocurrency mining operations.
The ministry noted that digital mining has become increasingly popular in the country due to its stable electricity prices and beneficial climate for digital currency mining operations. The income generated by these operations has contributed significantly to the national treasury, with taxes accounting for about 1% of the country’s total budget.
The ministry also pointed out that the funds raised from cryptomining taxes have been used to fund various government projects, such as the digital currency regulation law, which is aimed at providing a secure environment for the use and development of digital assets. Other projects that have been funded include the development of an electronic identification system and the renovation of roads and bridges.
The ministry further stated that the income generated from digital mining has played a critical role in strengthening the country’s economy. In order to continue the positive trend, the Kyrgyz government is aiming to increase the mining tax rate to 2.5%. The new tax rate will be imposed on miners who use more than 20 megawatts of electricity during their operations. The ministry is currently in the process of drafting a bill that will provide more clarity on the taxation of digital mining activities.