Marcel ‘s passion for the world of cryptocurrencies and his comprehensive knowledge of blockchain technology make him an invaluable asset to our team. He stays updated on the latest trends, regulations, and emerging technologies in the crypto space, ensuring that our audience receives accurate and up-to-date information.
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As a result of tax violations in China, Bitmain was warned of a $3.6 million punishment.
Based on the Finance Sina report, a 24.9 million yuan (more than $3.6 million) charge has been imposed on Bitmain, a manufacturer of mining equipment, for not covering taxes in Beijing.
A notification of withholding unpaid personal income tax was reportedly sent to the maker of mining equipment. The Chinese tax authorities have only sent Bitmain with a warning thus far.
What was in that notification?
August of the previous year saw the reiteration. According to the letter, the corporation owes 16.6 million yuan in unpaid personal income tax, or almost $2.4 million.
Here’s what the publication says:
“The corporation is required to withhold and pay individual income tax on incentives like travel subsidies for workers in accordance with the Tax Collection and Administration Law of the People’s Republic of China.”
The situation with crypto regulations in China
To safeguard the financial system and cut carbon emissions, Chinese authorities increased regulations on the cryptocurrency sector in 2021. China was responsible for around 65% of the global Bitcoin (BTC) hash rate at the time. The media also stated that numerous mining firms with headquarters in China were relocating their operations abroad. Bitmain specifically mentioned plans to relocate to Malaysia and Indonesia.
Profits for miners have substantially dropped since then. Particularly in 2022, numerous mining businesses announced financial difficulties and declared bankruptcy. Jihan Wu, a Chinese billionaire and co-founder of Bitmain, chose to establish a $250 million fund despite the challenging conditions facing the mining industry in order to purchase mining equipment from struggling businesses. A few months later, despite decreased profitability from Bitcoin mining, Bitmain’s Antminer mining device’s most recent model was completely sold out in under a minute. The price per piece of equipment was notable at $2092.