Russian President Vladimir Putin has recently signed a law that officially recognizes digital currencies as property for foreign trade settlements. This new legislation includes significant updates to the tax framework for cryptocurrency activities. Specifically, crypto mining and sales will be exempt from value-added tax (VAT), but operators must inform tax authorities about their clients or risk hefty fines. Income from crypto mining will be categorized as “income in kind” and taxed based on Market value, while individuals trading crypto will face a two-tier tax rate. Additionally, corporate profits from mining will be subjected to a standard corporate tax rate starting in 2025. The law aims to regulate and legitimize cryptocurrency operations within Russia.
In a significant development for the cryptocurrency landscape, Russian President Vladimir Putin has signed a new law recognizing digital currencies as property, specifically for use in foreign trade. This move is part of an experimental legal regime aimed at regulating the digital currency sector. According to reports, crypto mining and sales will be exempt from value-added tax (VAT), allowing operators more flexibility to conduct their activities without the added tax burden.
However, there are important obligations for mining operators. They must report their clients to tax authorities, and failure to comply with these regulations can lead to hefty fines, potentially reaching 40,000 rubles. Additionally, income generated from cryptocurrency activities will be classified as “income in kind” and taxed based on current Market valuations.
This new law also establishes a two-tier personal tax structure for individuals involved in the buying, selling, or trading of cryptocurrencies. Income up to 2.4 million rubles will be taxed at 13%, while amounts exceeding that threshold will be taxed at 15%. For businesses, profits earned from crypto mining will face the standard corporate tax rate of 25%, effective from 2025.
It’s important to note that participants in crypto mining and trading will not have access to certain tax benefits available to other sectors, which could limit their financial advantages.
This legislation is now in effect following its official publication, though some specific provisions may have set timelines for implementation, aimed at easing the transition for businesses involved in cryptocurrency activities.
This step comes on the heels of previous laws aimed at structuring and defining the regulations surrounding crypto mining in Russia. As the digital currency world continues to evolve, these regulations may pave the way for a more organized and compliant industry in the country.
Share your thoughts and stay updated on the effects of these new regulations in the cryptocurrency sector.
What does the new law about digital currencies in Russia say?
The law says that digital currencies are considered property, which means they can be owned and traded like other assets.
Will buying and selling cryptocurrency be taxed in Russia?
No, the law exempts cryptocurrency sales from value-added tax (VAT), so you won’t have to pay extra tax when you buy or sell crypto.
Is crypto mining taxed under this new law?
No, the law also exempts crypto mining from VAT, so miners won’t have to pay this tax for their activities.
How does this law affect people who invest in cryptocurrencies?
The law gives more legal clarity and protection to cryptocurrency investors, treating their digital assets as property.
When did this law come into effect?
The law was signed by President Putin and is effective immediately, meaning it applies right away.
