Buenos Aires to Tax Cryptocurrency Mining in 2023 – The province of Buenos Aires, Argentina, adopted a proposal to tax cryptocurrency mining for the upcoming year. A document presented by the governor of the province, Alex Kicillof, establishes that the activity formally referred to as “Processing and validation services for crypto assets and/or cryptocurrency transactions (crypto asset and cryptocurrency mining)” will be subject to a 4% impost on income generated from these operations.
The taxes would be paid to the provincial government and would be unrelated to other taxes created by the national government of Argentina. The paper clarifies that this tax will only apply when the hardware needed to implement this activity is actually located inside the province’s jurisdiction. This tax regime will begin to be implemented in January, however there are still unknown aspects regarding its implementation.
People Also Read: Coinbase Secures Regulatory Approval to Operate as a Virtual Asset Service Provider in Ireland
Analysts’ concerns over the application of this tax relate primarily to two areas. The first pertains to the definition of taxable equipment. If only proof-of-work hardware is included in the approved documents, only ASIC miners and graphics cards will be evaluated for these taxes. However, staking might also be charged if computers operating staking nodes are considered part of this hardware.
In addition, Argentine accountant Marcos Zocaro has reservations concerning the tax rate applicable to mined (or staked) cryptocurrencies. The document states that these crypto assets will be taxed at their “official or current value,” but fails to identify the source of these values, which vary between exchanges. Also unknown is whether this value will be determined when the cryptocurrency is mined or after the tax period ends.
In April, Buenos Aires announced it would allow users to pay taxes with crypto this next year. The city also has a project to use a blockchain ID system and will host Ethereum nodes as part of its digitization and modernization push in 2023.
READ MORE
Indian Government Updates Parliament on Cryptocurrency Bill and Investigations of Crypto Exchanges
Bank of Russia to Test International Crypto Payments With Companies
