The Iranian tax office wants to legalize crypto exchanges

According to a new proposal from the country’s tax office, the Iranian National Tax Administration (INTA) is pushing for a legal framework for the taxation of cryptocurrency trading platforms operating in the country.

Two months after Iranian President Hassan Rouhani called for a legal framework to trade in cryptocurrencies, INTA reportedly described in detail the need to legalize digital asset exchanges in a proposal cited by local media.

INTA reminded Iranian regulators that a legal framework is required for tax collection, and said the government should only allow currency exchanges to exchange currencies and monitor transactions.

The tax office insisted on maintaining the legal framework on the wider side of the spectrum in order to avoid harsh conditions for cryptobourses, which could cause the spread of the black market.

Three tax regimes

Capital gains tax, fixed base tax and occupational tax are the three tax regimes on cryptocurrency trading platforms proposed by INTA, although the proposal does not specify cryptocurrency taxation mechanisms.

According to sources, decentralized finance (DeFi) has also been included in the proposal. In order to comply with anti-money laundering rules, this proposal seeks to set an upper limit for transactions that take place on decentralized exchanges.

Miners in Iran

Iran’s parliamentary commission on economics has drafted a new bill to curb the use of cryptocurrencies in the country while providing a clearer legal framework for miners.

Cryptocurrency mining is still legal for licensed miners operating in Iran, although it is temporarily banned until September due to energy problems in the hot summer months. Miners are recognized as owners of digital assets.

On the other hand, the Iranian law enforcement authorities spent the summer conducting raids on unlicensed crypto miners. Police have secured up to 7,000 mining platforms in several operations. Last month, the government asked licensed cryptocurrency miners to stop production altogether until further notice.

Conclusion

It is also not illegal to convert one cryptocurrency to another. However, the current law allows banks and licensed exchanges to use digital currencies mined in Iran to pay for imports, while cryptocurrencies cannot be used for payments within the country. The new legal framework could thus help to better accept the crypto in the country.