Ukrainian government reports $81M tax loss from unregulated crypto exchanges since 2013

The state received less than $81 million from the budget due to the unregulated activities of crypto exchanges in Ukraine over the past 10 years.

Between 2013 and 2023, as a result of the activities of unregistered cryptocurrency exchanges, the state treasury did not receive about 3 billion hryvnias in taxes - $ 81 million, as the Bureau of Economic Security of Ukraine said in a statement. The state agency also carried out an analysis regarding the trading operations of exchanges founded by residents of Ukraine, in the conclusion of which there were about 55 billion US dollars in circulation in BTC, ETH, and Tether over the same period.

“There are different points of view on how such activities should be taxed, and [BEP] will act in accordance with the provisions adopted by the deputies,” said Andrei Pashchuk, deputy director of the Economic Security Bureau, “however, it is quite clear that they will be taxed.

President of Ukraine Volodymyr Zelensky signed the law "On virtual assets" in March 2022, creating a regulatory framework for the functioning of cryptocurrencies in the country. At that time, the government began to work on amending the tax and civil legislation of Ukraine in order to adapt them to the legal framework, but as of August 2023, no changes were made to the current regulation.

Many Ukrainian users of the crypto industry on the Telegram social network asked if they would be required to pay taxes on transactions made in the last 10 years. Some of them pointed out that the government did not adopt the relevant provisions, despite the fact that the law was supposed to be adopted back in 2022.

Mikhail Chobanyan, CEO of Ukrainian cryptocurrency exchange Kuna, told Cointelegraph that it was "impossible" for government officials to levy taxes on transactions before the legal framework was in place. According to Chobanian, the bureau's data was "taken from thin air" and its analysts "lack understanding of business."

Since the invasion of Russian troops into Ukraine in February 2022, many regions of Ukraine continue to face the threat of rocket attacks, as the invaders have reportedly temporarily occupied about 18% of the country's territory in the eastern and southern regions. Government buildings and businesses in Kyiv are under Ukrainian control.

Despite the hardships faced by the Ukrainian people at home and abroad, a number of industries in the country's tech sector are reportedly continuing to grow amid the Russian invasion - roughly 5% annual growth in export earnings for the year. Many representatives of the crypto industry actively support the Ukrainian military.