Indonesia’s Commodity Futures Trade Regulatory Agency (known as Bappebti) is considering levying a tax on all cryptocurrency transactions taking place on regulated exchanges within the country.

Currently, 13 cryptocurrency exchanges fall under Bappebti’s regulatory oversight, and the tax would be automatically applied by these platforms should it be approved, according to a report by the Phnom Penh Post.

“It is currently [undergoing] internal review at Bappebti, then we will coordinate with the BKF,” said Sidharta Utama, head of Bappebti, adding that the actual tax rate had not yet been decided. The BKF refers to Indonesia’s Fiscal Policy Agency.

Regulatory activity in Indonesia surged during the past six months as Bitcoin (BTC) and the wider cryptocurrency market soared to new all-time highs. In December 2020, Bappebti issued regulation recognizing an initial 229 cryptocurrencies as legally tradable commodities, while leaving the door open for traders to suggest adding new coins to the list. In February, the agency identified 13 trading platforms which it recognized as licensed entities.

Indonesia originally warned against the use of cryptocurrencies as a means of payment in 2014, and by 2017, had introduced legislation that demanded that fintech companies register with the Bank of Indonesia to ensure they weren’t using cryptocurrencies in payment systems.

Chairman of the Indonesian Crypto Asset Traders Association, Teguh Kurniawan, said the group he represents proposed a tax rate of 0.05%, adding that a high tax rate could push people towards illegal channels when purchasing cryptocurrencies.

“To date, there has been no feedback on the type of tax. We hope the tax rate will not be too high, [or] we fear that investors may turn to investing in crypto [assets] through illegal channels, which would be harmful,” said Kurniawan.