The financial watchdog in Ukraine has unveiled a proposal to tax certain crypto transactions as personal income, with rates potentially reaching 23%. The National Securities and Stock Market Commission (NSSMC) introduced the draft framework on April 8, aiming to help lawmakers build a comprehensive crypto tax structure that aligns with international standards while addressing the country’s unique financial needs. According to the proposal, crypto-to-fiat conversions and payments made using crypto would attract an 18% income tax, accompanied by a 5% military levy. Crypto-to-crypto transactions, however, would remain untaxed—a decision designed to mirror the approaches taken in crypto-forward jurisdictions like Austria, France, and Singapore. NSSMC Chairman Ruslan Magomedov stressed the urgency of the initiative, stating that “the issue of crypto taxes is not a hypothesis, but a reality that is fast approaching.” He emphasized the importance of crafting thoughtful, context-sensitive legislation that weighs the pros and cons of each policy choice before it makes its way into law. Low-Impact Users Get Breathing Room in Ukraine One of the more progressive aspects of the NSSMC’s plan is its treatment of stablecoins. Since Ukraine’s tax code already excludes income from foreign currency transactions, the regulator suggests that stablecoins—often pegged to foreign fiat—either be fully exempt or subject to a much lower tax rate, ranging from 5% to 9%. In an apparent bid to support retail adoption and minimize overregulation, the draft also proposes exemptions and thresholds. Transfers between family members, crypto held for a long duration, and small-scale activities could be exempted or taxed at a reduced rate . These provisions aim to reduce compliance burdens on casual users while maintaining oversight over significant market participants. Mining, Airdrops, and Staking Addressed Separately Beyond regular transactions, the framework also tackles the taxation of other crypto-related activities such as mining, staking, and token distributions via airdrops and hard forks. While crypto mining is largely treated as a business activity, the NSSMC floated the idea of tax-free thresholds to support independent miners. Staking rewards may be taxed only when converted into fiat, and airdrops could be taxed either as ordinary income or upon liquidation. Notably, the document hints that non-custodial wallets might not qualify for exemptions, though this remains a topic for further discussion. The proposal follows on the heels of a legislative review of a draft bill to legalize cryptocurrencies. Ukraine began laying the legal groundwork for crypto regulation in March 2022, when President Volodymyr Zelenskyy signed the country’s first crypto market law into effect. The post Ukraine Proposes 23% Tax on Crypto Cash-Outs, Exempts Stablecoins and Token Swaps appeared first on TheCoinrise.com .
