Ukraine is moving forward with plans to legalize crypto assets like Bitcoin (BTC) by the first quarter of 2025.
Danylo Hetmantsev, the head of the Ukrainian Parliament Committee for Finance, Tax, and Customs Policy, confirmed this development while speaking at the Ekonomichna Pravda Forum on Domestic Investment Opportunities.
Ongoing Efforts to Legalize Crypto in Ukraine
During the conference, Hetmantsev provided insight into the ongoing legislative efforts and the country’s cautious approach toward cryptocurrency regulation.
He revealed that a parliamentary working group is currently finalizing a draft law to regulate crypto assets. The legislation, developed in collaboration with the National Bank of Ukraine and the International Monetary Fund (IMF), is expected to be ready for its first reading after the New Year.
“Our goal is to pass this law and ensure cryptocurrency is legalized in Ukraine during the first quarter of 2025,” Hetmantsev stated.
No Tax Breaks on Crypto Assets
However, the anticipated legalization will not include tax exemptions for cryptocurrency transactions. The proposed tax framework will follow a model similar to the one used for securities, where profits are taxed when virtual assets are converted into fiat currency.
Hetmantsev explained that, after consulting with European experts and the IMF, a cautious approach had been adopted regarding tax exemptions. “Allowing exemptions could potentially lead to tax evasion in traditional markets,” he added.
The legislation on cryptocurrency taxation has already taken a significant step forward. In November 2023, a draft law on taxing virtual asset transactions was registered in the Ukrainian parliament. The adoption of this law is expected to be the final step toward fully legalizing cryptocurrencies in the country.
Meanwhile, other countries like Russia and South Korea are taking different approaches to crypto taxation. South Korea recently announced differing taxation on crypto assets for another two years, citing the need to refine the legislation further.
Last month, Russian President Vladimir Putin approved a law that treats crypto assets as property. The new law also exempts the mining and sale of crypto from VAT.
Income from mining will be taxed as in-kind income. At the same time, transactions involving digital currency are subject to a two-tier tax rate: 13% for earnings up to 2.4 million rubles, while 15% applies for incoming above this threshold.
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