Ukraine’s SEC proposes 23% total tax on crypto income

Ukraine’s securities regulator proposed to apply full income and military taxes in the country to crypto gains, totaling 23%.

UkraineThe Securities and Exchange Commission proposed a tax of 23% on the income of individuals of cryptographic operations, made up of a personal income tax of 18% and a military tax of 5%.

In 32 pages consultation documentThe agency noted that the taxation of personal income from cryptographic transactions is “one of the most complex aspects” in the creation of a tax regime in the field of digital assets.

The main challenge, he said, comes from the anonymous and decentralized nature of the crypto, because many operations with cryptocurrencies “are carried out by decentralized platforms or the use of self-centered portfolios, which makes automatic monitoring by tax authorities.” Another problem is that individuals, not intermediaries, are responsible for the income declaration.

“Unlike traditional income (salary, dividends), where the tax obligation is fulfilled by a tax agent (for example, an employer or a bank), in the case of virtual assets, this function is most often performed by the individual.”

Ukraine securities and exchange commission

He also pointed out that taxpayers often cannot prove to what extent they have spent acquiring tokens because the purchase expenses of token “are often absent, especially if they were obtained through a peer-to-peer exchange, pubOr mining. “”

Cryptographic prices oscillations still complicate tax obligations, says the regulator, adding that rapid change in cryptography prices “can lead to situations where a person is forced to pay a tax on” paper profit “that has disappeared due to a drop in the market.”

In addition to this, many users may not even know that they owe taxes, says the regulator. In the document, the Commission called for simplified reporting models, fiat-exit taxation and digital tools to help individuals comply with their tax obligations.