- According to the report, cryptocurrency would be considered property for tax reasons.
- Trading profits will be taxed at the same rates as those for securities transactions.
Using the country’s Finance Ministry as a source, Russian news agency Interfax reported on Monday that the Russian government has authorized draft modifications to a law regarding the taxation of cryptocurrency transactions and mining.
According to the report, cryptocurrency would be considered property for tax reasons under the proposed law. Therefore, the tax rate on mining profits will be the same as the rate on other forms of income. At the market value at the moment of receipt. Nevertheless, mining-related costs may be claimed as a tax deduction by miners.
Finding a Middle Ground
Trading profits will be taxed at the same rates as those for securities transactions. Up to a maximum of 15% for individuals, but value-added tax will not apply to cryptocurrency transactions. The purpose of the changes is to make sure everyone is on the same page. By making mining operators publish details about who is utilizing their infrastructure.
The decision to tax mining profits is an attempt to find a middle ground between industry and government interests, according to Russia’s Finance Ministry. Interfax reports that the country’s first cryptocurrency tax law was submitted in December 2020. And passed its first reading in 2021.
Last month, the Russian government’s tax agency suggested taxing the profits that miners do not yet have. The Russian government has imposed a cap on the amount of electricity that unregistered persons may use to mine bitcoin, stating that the monthly usage cannot exceed 6,000 kilowatt-hours.
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