Russia’s crypto community is witnessing a massive standoff between the country’s Ministry of Finance and the Central Bank of Russia (CBR).
The new ‘crypto regulation’ policy has become mandatory for the Russian crypto communities to follow. Moreover, cryptocurrencies have become a taxable asset under another important legislative amendment.
The amendments regarding the federal tax code of cryptocurrencies are expected to pass by the end of the summer parliamentary session, said Anatoly Aksakov, head of state Duma’s financial markets committee.
Furthermore, the government officials must report the transactions exceeding 6,00,000 Rubles ($8000) per year. If they fail to report such huge transactions, they will be charged up to 40% tax as the ‘non-reporting fine.’
Due to Russia’s ongoing geopolitical crisis, the crypto regulations have been held for a while, as mentioned by Aksakov. Duma’s emergent task force is drafting an ‘anti-crisis’ policy.
The regulatory framework between CBR and the Finance Ministry has decided the fate of this new crypto policy amendment. Even though the CBR has suggested putting a complete ban on crypto trading and mining, the ministry favors regulating crypto over simply outlawing it.
It still seems like CBR will abide by its restrictive opinions, and it might show its effect on the tax amendments.
The tax weightage: 20% for firms and 13% for individuals
Estimates of Federal tax revenue of crypto suggest that amounts ranging from 10-15 billion Rubles ($122,181) to 20 billion Rubles or around ($1 billion) will be collected as tax revenue. The proposed tax will be levied on revenue only – 13% of personal income and 20% on legal entities.
Qualified investors can enjoy a tax deduction of 52,000 rubles or more per year. Taxes are unlikely to apply to assets collected in 2021 but will hit the crypto transactions of Russian citizens carried out in any jurisdiction.
“This is a move by the Federal Tax Service, is backed by the Department of Industry and Trade and several officials and former officials of the Treasury Department,” said Aleksandr Podobnykh, chief information security officer of digital assets company Security Intelligence Cryptocurrencies Platform (SICP).
Alexander is a taxpayer from Singapore and the CEO of a global crypto credit card firm- Embily. He mentioned that this tax amendment resulted from a clash between CBR and the Ministry of Finance. He believes in the potential of Russia and wishes that these amendments can bring a ray of new opportunities for the country.