Indonesia Introduces Higher Taxes on Crypto

Today’s ESG Updates

• Indonesia Hikes Crypto Taxes to 1% for Foreign Sellers: The country’s finance ministry raises transaction taxes effective August 1, while reclassifying crypto as a financial asset.
• Japan Sets New Heat Record at 41.2°C Amid Climate Crisis: Temperatures in Japan reach historic highs, as heatstroke cases surge in 33 prefectures.
• Google to Sign EU AI Code Despite Regulatory Concerns: Tech giant plans to commit to code of practice, despite citing risks to innovation.
• EPA Seeks to Strip Greenhouse Gas Regulation: Proposed rollback of 2009 finding could destroy U.S. climate regulation during intensifying extreme weather.

Indonesia to increase cryptocurrency taxes

Indonesia’s finance ministry has announced plans to raise taxes on cryptocurrency transactions, effective August 1. The new regulation will affect foreign sellers the most, as the tax will increase from 0.2% to 1%. Sellers in domestic exchanges will be subject to a slight tax increase from 0.1% to 0.21%. Value-added tax (VAT) will be removed for buyers; however, crypto mining will see an increased VAT of 2.2% (up from 1.1%). With more than 20 million users and assets valued at over 650 trillion rupiah ($39.67 billion), Indonesia is now reclassifying cryptocurrencies as financial assets, rather than commodities. Binance-backed Tokocrypto supports the change but argues for fiscal incentives to allow for innovation within the sector.

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Further reading: Indonesia to raise tax rate on crypto transactions

Heatwave hits Japan as temperatures reach 41.2 degrees Celsius

Much like the heatwaves affecting Europe and the United States, Japan saw its hottest June on record this year. On Wednesday, it broke another record, experiencing its hottest day. In Tamba City, a city southwest of Tokyo, temperatures reached 41.2 degrees Celsius (106.16 degrees Fahrenheit). The previous record was 41.1 °C (105.98°F), which was set in the country for the first time in 2018 and again in 2020. Last week, over 10,800 people suffered from heatstroke, causing around 16 heat-related deaths. Of Japan’s 47 prefectures, 33 have been issued heatstroke alerts as temperatures remain high. Human-induced climate change is causing devastation across the globe. Now, more than ever, it’s essential that companies remain committed to their ESG goals. 

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Further reading: Japan records highest temperature on record

Google plans to sign EU’s code of practice for AI technologies

Google’s President of Global Affairs, Kent Walker, announced in a blog post Wednesday that the company will sign the European Union’s AI code of practice. The code offers a roadmap for companies to comply with regulations under the Artificial Intelligence Act (AI Act). In his post, Walker writes that Google has concerns that these strict requirements could lead to a lag in AI development throughout Europe. He said, “In particular, departures from EU copyright law, steps that slow approvals, or requirements that expose trade secrets could chill European model development and deployment, harming Europe’s competitiveness.” Despite concerns, Google’s signing the code could positively affect its ESG reporting. Companies can utilize ESG tools to ensure their targets are met in 2025.

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Further reading: Google to sign EU’s AI code of practice despite concerns

Trump administration to drop greenhouse gas regulation authority

The Environmental Protection Agency (EPA) announced on Tuesday a new proposal to eliminate the U.S. government’s power to regulate greenhouse gases. They aim to do this by rolling back a 2009 endangerment finding, which determined that the presence of air-polluting gases negatively impacted public health and welfare. Christy Goldfuss, executive director of the Natural Resources Defense Council, said, “As Americans reel from deadly floods and heat waves, the Trump administration is trying to argue that the emissions turbocharging these disasters are not a threat.” The move will severely threaten the U.S.’s ability to combat climate change, as future changes will be subject to strict bureaucratic scrutiny. 

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Further reading: EPA Unveils Plan to Scrap US Authority to Regulate Greenhouse Gases

Editor’s Note: The opinions expressed here by the authors are their own, not those of impakter.com — Cover Photo Credit: Traxer