Vietnam is becoming one of the countries with the highest level of interest in cryptocurrency, with about 17 million people owning this asset. Against the backdrop of a developing cryptocurrency market, Vietnam's Ministry of Finance is promoting the development of a legal framework to manage and exploit the economic potential of this field. According to the agency, digital asset transactions will have to comply with tax obligations as prescribed by law. Also Read: Ministry of Finance: Buying and Selling Digital Assets Will Be Taxed Proposed Cryptocurrency Taxation Mechanism in Vietnam Vietnam is aiming to build a tax system to control and exploit the economic potential of the cryptocurrency market. Currently, several taxation methods are being proposed, including: 1. Low Transaction Tax: Applying a tax rate of around 0.1% on each cryptocurrency transaction, similar to stock tax. According to the Vietnam Blockchain Association, this policy could generate over $800 million/year without disrupting the market. 2. Income Tax: Taxing personal income from cryptocurrency investments, similar to managing profits from stocks or real estate. Businesses operating in the industry may also be subject to a corporate income tax of around 20%. 3. Licensing Fees: Implementing licensing fees for cryptocurrency exchanges or initial coin offering (ICO) projects. This policy helps both control the market and create a non-tax revenue source for the Government. Additionally, regulatory agencies may require domestic platforms to report detailed transactions and engage in international cooperation to manage cross-border transactions. This ensures that cryptocurrency transactions are transparent and comply with legal regulations, including tax obligations. The implementation of the tax system also faces many challenges, including transaction anonymity and technological limitations in tracking. The government needs to invest in modern blockchain analysis tools and build a transparent and simple legal framework to effectively manage this market. Tax models need to be carefully designed to avoid tax rates that are too high or too complex, which could lead to capital outflows. At the same time, investing in advanced blockchain analysis technology is necessary to effectively monitor cryptocurrency transactions. Source: Znews