China fines Bitcoin mining firm Bitmain over tax violations
According to a recent report from a local news agency Sina Finance, China has sanctioned the Bitcoin mining company Bitmain Technologies for alleged tax violations.
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Bitmain has been fined by the Beijing Municipal Office of the State Administration of Taxation, as per the aforementioned news report. The Beijing regulator has fined Bitmain approximately 25 million Chinese yuan ($3.7 million).
On 4 April, Bitmain was fined for allegedly failing to pay personal income taxes in accordance with Chinese laws based on tax collection administration.
The regulator statement explicitly mentioned certain tax violations involving salaries, bonuses, labor dividends, and allowances of Bitmain employees.
The tax body also stated that in August 2022, tax inspectors served Bitmain with a notice for violating certain tax norms. So far, Bitmain’s Beijing unit has failed to pay a total of 16.6 million yuan ($2.4 million) in personal income tax.
How Bitmain survives despite China’s crypto ban
Bitmain, which was founded in 2013, is one of the world’s largest cryptocurrency mining companies, best known for producing crypto mining-specific hardware and services.
In response to the Chinese government’s blanket ban on cryptocurrency imposed in September 2021, the company was reportedly forced to cease operations in China in October 2021.
Even as there is regulatory uncertainty amidst a major bearish sentiment in the crypto market in 2022, Bitmain’s enterprise has continued to thrive.
It’s unclear how the firm has been running its operations since. It is amidst these circumstances that Chinese authorities have cracked down on the mining firm Bitmain.
Despite falling mining profitability, Bitmain’s latest Antminer device reportedly sold out in less than a minute in December 2022. Bitmain founder Jihan Wu established a $250 million fund in September 2022 to assist the mining industry affected by the prolonged cryptocurrency winter. Wu founded Bitdeer, a new crypto mining firm and a spin-off of Bitmain, after leaving Bitmain in 2021.