Starting in early 2023, cryptocurrency miners operating in Kazakhstan will be required to pay a new fee for the electricity needed to mint digital coins. introduced in 2021. The surcharge, which now depends on the price of electricity consumed by bitcoin farms, could be much higher than the original surcharge.
The New Year brings higher costs for companies mining crypto in Kazakhstan
Starting January 1, electricity rates charged to crypto miners in Kazakhstan have been calculated according to a progressive scale: the universal surcharge of 1 Kazakhstan tenge ($0.002) per kilowatt-hour (kWh), first adopted in summer 2021, is now 25 tenge (more than $0.05), which could reach as high as 25
The tariff in each case depends on the source and price of the electrical energy used to extract the digital currency. The new mechanism for determining tariffs was introduced in the bill amending the country’s tax code, signed by President Kasym-Jomart Tokayev in July 2022.
The basis for the levy is the average price of electricity consumed by the miner during a given tax period; according to the latest tariffs cited by Interfax Kazakhstan and other local media, if a company pays more than 24 tenge per kWh, a minimum charge of 1 tenge will be imposed.
The minimum charge will also be offered to crypto-farms that use renewable energy sources and will not take into account the cost of electricity. And for energy generated from other sources, the cheaper the electricity used, the heavier the tax burden. Rates could go up to 25 tenge per kWh, the report details.
Kazakhstan became a mining hotspot after China cracked down on the industry in 2021, attracting crypto miners with its low subsidized electricity rates. The influx of mining companies has been blamed for the country’s growing electricity shortage.
Nursultan authorities are taking steps to go after unlicensed mining farms and regulate the sector more comprehensively: provisions in a new bill adopted by the Kazakhstan parliament in December aim to require miners to purchase surplus electricity on government-controlled markets
Earlier legislation submitted by a group of lawmakers in October restricted mining to registered companies only. It also allows non-residents to mine in the country if they have a contract with a locally licensed data center.
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