Key Takeaways
- Ukraine’s NSSMC has introduced a taxation matrix to clarify how virtual assets are taxed.
- The matrix applies to mining, staking, airdrops, and other VA-related activities.
- The National Bank of Ukraine is separately preparing laws to define regulatory oversight of VAs.
Ukraine’s National Securities and Stock Market Commission (NSSMC) has introduced a comprehensive taxation matrix for cryptocurrencies.
The framework, designed to align with global practices, provides much-needed clarity on how crypto-related activities, such as mining, staking and airdrops, will be taxed.
The NSSMC is also preparing draft legislation based on the matrix and has already presented it to Ukraine’s parliamentary finance committee.
The matrix is part of Ukraine’s broader effort to modernize its economy, foster crypto adoption and formalize oversight.
It comes amid continued military and economic pressure stemming from Russia’s invasion, which has accelerated the country’s shift toward digital assets.
A Structured Framework for Taxation
Ukraine’s proposed taxation model outlines an 18% personal income tax on crypto and a 5% military levy. Preferential tax rates of 5% and 9% may apply to select transactions under specific conditions.
Crucially, the matrix distinguishes between taxable and non-taxable events. Only exchanges of cryptocurrencies for fiat currency or non-virtual goods and services are subject to tax.
Crypto-to-crypto exchanges are excluded, providing a degree of relief and clarity for traders and investors.
Depending on the transaction’s nature, taxable income may be calculated as either gross revenue or net income (after expenses).
Income can be recognized at several stages: when an asset is received, exchanged for fiat or goods or used as compensation for services.
Drawing from Global Best Practices
Ukraine’s proposed approach draws inspiration from other jurisdictions with favorable crypto tax frameworks.
Austria and France, for instance, do not tax crypto-to-crypto exchanges. Singapore imposes no capital gains tax on digital assets, while Malaysia exempts non-routine crypto transactions. Georgia offers full tax exemptions on crypto income and capital gains for individuals.
Ukraine’s matrix exempts activities such as mining, staking, token creation, storage, and free token distribution from VAT treatment.
However, payments in crypto for goods or services may be subject to VAT under existing European Union rules—some of which may qualify for exemptions depending on how EU law is applied.
Regulatory Oversight in Progress
While the NSSMC focuses on taxation, the National Bank of Ukraine is developing separate legislation to define the division of regulatory powers over the crypto industry. That legislation is expected to be finalized by October 2025.
The draft law will be based on the European Union’s Markets in Crypto-Assets (MiCA) regulation, which Ukraine has committed to adopting as part of its broader alignment with EU standards.
Together, these efforts mark a decisive step toward legitimizing the country’s crypto ecosystem and integrating it into the formal economy.
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