PANews reports that the upper chamber of parliament in Russia has approved a government-initiated measure that establishes a tax framework for digital currencies.
This development occurs subsequent to the bill’s initial approval in the State Duma, the lower house, and its final passage in a plenary session on Wednesday. The new law categorizes digital currencies, including those employed as payment instruments under experimental legal frameworks, as property under the Russian Federation Tax Code. This classification alleviates the financial burden on participants in the digital currency mining and sales sector by exempting them from value-added tax (VAT). The services provided by authorized organizations that facilitate transactions under these experimental frameworks will also be exempt from VAT.
A significant provision of the law mandates that mining infrastructure administrators report personal data of individuals who use their systems to tax authorities. The income generated from digital currency mining will be classified as taxable income and will serve as the foundation for personal income tax. According to Danil Volkov, the director of a pertinent department at the Russian Ministry of Finance, enterprises that engage in mining activities will be subject to the standard corporate income tax rate.
According to the legislation, mining income will be subject to taxation on the basis of the asset value on international exchanges. The personal income tax rate will remain at 13% for the majority of digital currency earners. However, commencing in 2025, the rate will increase to 15% for annual incomes exceeding 2.4 million rubles.
The bill underwent numerous readings in the State Duma, required approval from the Federation Council, and is currently awaiting the president’s assent to become law during the legislative process. This legislation is poised to formally establish a comprehensive tax framework for digital currencies in Russia, with President Putin’s anticipated support.
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