Senate approves Paraguay crypto mining bill
Paraguay crypto bill that regulates cryptocurrency mining and trading within the country, has finally been approved by the country’s Senate.
The deputy chamber approved the bill but added some changes regarding electricity consumption in Paraguay. President Mario Abdo Benítez is now obliged to decide whether he will support, sanction or apply a veto to the bill.
Counting 7 million electricity users, Paraguay mostly depends on hydroelectric generation as the country also serves as a significant energy exporter.
However, the electricity expenditure rose by over 100% in the last 12 years, while its generation is falling. The state power operator, Administración Nacional de Electricidad (ANDE), wants to urge a new consumption plan within the next few years.
On the other hand, Paraguay’s central bank worries that the fact that cryptos are still not regulated as payment in the country could lead to halts in electricity consumption associated with crypto mining.
According to the bill, Paraguay’s Ministry of Industry and Commerce will be the governmental body that will regulate cryptocurrency-related services.
Paraguay crypto bill tax excludes paying VAT
The bill, therefore, urges crypto mining companies to come up with a power consumption plan and present it to the national power body, which will be authorized to cut the electricity if the companies do not act according to these plans. Also, the bill defines that the payment for the power services is made in advance.
Furthermore, crypto miners won’t have to pay their VAT but are obliged to pay income taxes. However, some lawmakers have shown their disapproval about the law's approval in its current form, with some calling for a presidential veto.
However, the bill was not approved easily. Senator Esperanza Martínez mentioned that the Guasu Front Bank did not comply with the project, adding that cryptocurrency is not an industry per se as it doesn’t process either raw material adding value, or employing people.
"Both versions are detrimental to the country," she said.
Senator Enrique Bacchetta commented that he had voted for rejection at the time because this initiative did not produce jobs.
Author: Teuta Franjkovic
A sincere writer with a strong will to share knowledge on all things blockchain, crypto, metaverse and DeFi. Starting out as a writer with Cosmopolitan, Teuta has risen through the ranks of business journalism, editing newspapers and websites within the fintech industry for over 15 years. She holds a double MA in Public Politics and Entrepreneurship.