Ukraine Proposes 23% Tax on Certain Crypto Incomes, Exemptions for Stablecoins
April 10, 2025 – Kyiv, Ukraine
In a significant move towards regulating cryptocurrency, Ukraine’s National Securities and Stock Market Commission (NSSMC) has proposed a tax framework to impose a 23% tax on some crypto incomes. The framework, which was released on April 8, 2025, is designed to assist lawmakers in making informed decisions amidst the rapidly changing landscape of digital assets.
Tax Structure on Crypto Transactions
Under the NSSMC’s proposal, transactions involving cryptocurrencies will be treated as personal income and taxed accordingly. Specifically, a tax rate of 18% will be imposed, with an additional 5% military levy, resulting in a total effective tax rate of up to 23%. Importantly, the framework stipulates that crypto-to-crypto transactions, as well as stablecoins, will be exempt from taxation, aligning Ukraine with several European nations, including Austria and France, as well as crypto-friendly locations like Singapore.
NSSMC Chairman Ruslan Magomedov emphasized the urgency of establishing a tax framework, stating, “The issue of crypto taxes is not a hypothesis, but a reality that is fast approaching.” He explained that the proposed framework aims to provide lawmakers with comprehensive insights into the potential implications of various tax options on the local market and tax liabilities.
Framework Details and Exemptions
The NSSMC’s proposed regulations indicate that taxes will apply when cryptocurrencies are converted into fiat currencies or exchanged for goods and services. Notably, transactions involving stablecoins—digital currencies pegged to traditional fiat currencies—could be exempt from the proposed tax obligations. The regulator argues that applying a tax to stablecoins would contradict the existing Ukrainian tax code, which excludes income derived from transactions in “foreign exchange values.”
The proposal also elaborates on additional crypto-related activities, including mining, staking, airdrops, and hard forks. According to the NSSMC, crypto mining is largely regarded as a business activity, though there could be specific tax-free limits on certain transactions. Staking could be classified as “business captive income” and would only incur taxes when the cryptocurrency is converted into fiat, while proceeds from hard forks and airdrops could be subjected to taxation either as regular income or when the tokens are liquidated.
Addressing Small Investors
To relieve financial burdens on smaller investors, the NSSMC suggests implementing a tax-free threshold, a common practice in several other jurisdictions. Furthermore, potential exemptions for donations, intra-family transfers, and long-term cryptocurrency holders are being considered. However, the NSSMC has noted that such exemptions may not apply to non-custodial crypto wallets.
Road to Regulation
Ukraine is actively working towards creating a structured legal framework for cryptocurrency. Last December, Daniil Getmantsev, head of the tax committee in Ukraine’s parliament, indicated that a draft bill aimed at legalizing cryptocurrencies was under review, with expectations for its finalization earlier this year. This comes as a follow-up to President Volodymyr Zelenskyy’s signing of a law in March 2022, which established guidelines for a regulated crypto market within the country.
As the global cryptocurrency market continues to evolve, Ukraine’s regulators are taking proactive measures to ensure that the country can adapt and foster a stable environment for digital assets, balancing innovation with fiscal responsibility.
Conclusion
With the proposed tax framework on cryptocurrencies, Ukraine is taking a pivotal step towards formalizing its digital economy. The NSSMC’s recommendations will provide crucial guidelines for lawmakers as they navigate the intricate and rapidly changing landscape of cryptocurrency regulation, aiming to create clarity and foster growth within the sector.