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China Fines Bitmain $3.6M for Tax Violation, Report – Mining Bitcoin News
Chinese authorities have fined leading crypto-mining hardware maker Bitmain for tax-related violations, local media reported. The penalty comes amid increasing tax scrutiny in the digital asset sector, according to information from the crypto community.
Bitmain fined for failure to pay income tax on behalf of employees
One of the world’s largest manufacturers of devices designed for cryptocurrency mining, Bitmain, has reportedly been fined for unpaid taxes. The news was spread on social media by Chinese crypto journalist Colin Wu, also known by his Twitter handle ‘Wu Blockchain’.
Bitmain, the world’s largest bitcoin mining company, was fined about $3.55 million by the Beijing Tax Bureau in April, mostly for unpaid personal income tax.
— Wu Blockchain (@WuBlockchain) 11 April 2023
Wu was referring to a report by Sina Finance on Tuesday, according to which Beijing Bitmain Technology is facing a hefty fine of nearly 25 million yuan (over $3.6 million at the time of writing) imposed by the municipal tax bureau in the Chinese capital.
The company allegedly failed to withhold and pay individual income tax on benefits provided to its employees, such as travel subsidies. The amount, to be paid according to the Tax Collection and Administration Law of the People’s Republic, exceeds 16.6 million yuan (over 2.4 million US dollars).
Bitmain was notified by Beijing tax authorities of its obligations in August 2022, the publication further noted. However, the company has yet to withhold and pay the above personal income tax, Sina Finance wrote.
In a subsequent chirping, Wu Blockchain pointed out that the Chinese government has stepped up tax inspections on the cryptocurrency industry since last year. According to the cryptoblogger, bitcoin miners and major cryptocurrency traders have been specifically targeted.
Following China’s crackdown on crypto-related activities such as mining in early 2021, Bitmain announced in October of that year that it is ending supplies of mining equipment to mainland customers. According to media reports, the Beijing-based company, which makes application-specific integrated circuits (ASIC) mining rigs, was also considering moving most of its production elsewhere in the region.
Do you think the Chinese tax authorities will increase the pressure on crypto companies still operating in the country? Share your thoughts on the topic in the comments section below.
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