Chinese authorities have fined leading crypto mining hardware manufacturer Bitmain for tax-related violations, local media reported. The penalty comes amid increasing tax checks in the digital asset sector, according to information from the crypto community.
Bitmain Fined for Failing to Pay Income Tax on Behalf of Employees
One of the world’s largest producers 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 machine company, was fined about $3.55 million by the Beijing tax bureau in April, mainly for unpaid personal income taxes. https://t.co/wbXF3pFYxn
— Wu Blockchain (@WuBlockchain) April 11, 2023
Wu referred 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 taxation bureau in the Chinese capital.
The company has allegedly failed to withhold and pay individual income tax on benefits provided to its employees such as travel subsidies. The amount, due under the Tax Collection and Administration Law of the People’s Republic, exceeds 16.6 million yuan (over $2.4 million).
Bitmain was notified by the Beijing tax authority about its obligations in August 2022, the publication further noted. However, the company has not yet withheld and paid the above-mentioned personal income tax, Sina Finance wrote.
In a subsequent tweet, Wu Blockchain pointed out that the Chinese government has stepped up tax inspections on the cryptocurrency industry since last year. According to the crypto blogger, bitcoin miners and large cryptocurrency traders have been specifically targeted.
Following China’s crackdown on crypto-related activities like mining in early 2021, Bitmain announced in October of that year that it was terminating deliveries of mining equipment to customers in the mainland. According to media reports, the Beijing-based company, which makes application-specific integrated circuit (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 subject in the comments section below.
Image Credits: Shutterstock, Pixabay, Wiki Commons, Burdun Iliya / Shutterstock.com
Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.