While operations with digital assets are not taxed in Uzbekistan, the government is receiving a growing amount of revenues from the industry. The increase in budget receipts has been attributed to the licensing regime and the introduction of fees for crypto companies.
Crypto Exchange in Uzbekistan Pays Over $10,000 a Month to the State Coffer
Licensed crypto firms have paid 3.5 billion Uzbekistani som (more than $310,000) to the budget in the course of 2022, Uzbekistan’s regulatory authority responsible for the oversight in the sector revealed during a press conference, quoted by the crypto news outlet Forklog.
At the briefing, the National Agency of Perspective Projects (NAPP), a body subordinated to the president, announced the results of its activities. Officials said that the government has been able to collect the money thanks to the revamped licensing system and the imposing of fees for businesses working with digital assets.
Five crypto platforms are currently authorized to legally operate in the country and they have paid the said total. These are the state-controlled exchange Uznex and four smaller exchanges – Crypto Trade NET, Crypto Market, Crypto Express, and Coinpay.
Since October, crypto service providers in Uzbekistan are required to pay fixed monthly fees for their activities. These range between over $10,000 for cryptocurrency exchanges like Uznex and around $500 for the smaller trading platforms, also referred to as “crypto shops.”
At the same time, operations of individuals and organizations related to crypto transactions are subject to taxation in the Central Asian nation, even when carried out by non-residents and companies based in other jurisdictions, according to the current law.
However, the government in Tashkent has previously warned Uzbekistan’s citizens to avoid unlicensed exchange services. In August 2022, it tried to restrict access to online trading sites based outside the country. Uzbekistanis were allowed to buy and sell coins on domestic exchanges in November, 2021.
The NAPP also noted that 80% of the fees paid by the licensed crypto firms go to the state budget, while the remaining 20% are transferred to its own accounts. In late June, 2022, the agency presented registration requirements for miners who are relieved from taxation as well. Cryptocurrencies, mining and trading were regulated with a presidential decree issued two months earlier.
Do you think Uzbekistan will start taxing crypto companies in the future? Share your expectations in the comments section below.
Lubomir Tassev is a journalist from tech-savvy Eastern Europe who likes Hitchens’s quote: “Being a writer is what I am, rather than what I do.” Besides crypto, blockchain and fintech, international politics and economics are two other sources of inspiration.
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