Kyrgyzstan’s crypto mining tax revenue has dropped significantly in 2024, contributing only around $535,000 to the national budget—nearly half of the $1.08 million collected in 2023.
A budget report from the Kyrgyzstan Ministry of Economy and Finance revealed that tax receipts from crypto mining fell by 50%, amounting to just over 46.6 million Kyrgyzstani soms this year, compared to 93.7 million soms last year. Local media outlet 24.kg noted that revenue from the sector has been in steady decline, with a 30% drop in the first seven months of 2024 compared to the same period in 2023.
This decline is unexpected, given Kyrgyzstan’s reputation as a prime destination for crypto mining due to its abundant hydroelectric resources. The country’s 10% crypto mining tax—applied to the electricity costs incurred by miners—includes value-added and sales taxes.
The current downturn contrasts sharply with the optimistic start of the year. In early 2023, the Finance Ministry reported a dramatic surge in crypto mining tax revenue, collecting 78.6 million soms (around $883,000) in the first few months alone—far surpassing the 11.1 million soms ($133,200) collected during the same period in 2022.
The reasons behind the steep decline in 2024 remain unclear, but the drop highlights challenges for Kyrgyzstan’s crypto mining sector and its role in the nation’s economy.
Image Credit: Pixabay
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