The Russian government has approved draft amendments to the bill on taxation of income and expenditures from crypto mining and its purchase and sale.
According to an Interfax International Information Group report, the legislation will define cryptocurrencies as properties for tax purposes. Revenue obtained through Bitcoin mining and trading activities will fall under taxable provisions.
A 15% Tax on Crypto Mining
The report further noted that crypto transactions will not incur value-added tax and will instead align with the taxation structure as personal income from securities, taxed at no more than 15%.
For mining, taxes will be calculated based on the prevailing market value of assets when acquired. Additionally, miners can offset operational expenses against their taxable earnings. The updated regulations mandate that infrastructure providers supporting mining activities report details of miners utilizing their platforms periodically.
The Russian Finance Ministry stated that levying taxes on mining revenues ensures a fair representation of these operations. It noted that the strategy aims to harmonize governmental objectives with business priorities.
“As a result of discussions with businesses, a decision was made on the advisability of taxing the financial result from mining as the fairest reflection of the results of this activity. The approach is aimed at observing a balance between the interests of businesses and the state,” the Finance Ministry said.
Russian to Control Crypto Mining Energy Consumption
The current development is a part of Russia’s broader push to establish oversight in the crypto sector. In recent months, authorities have worked to address energy usage tied to crypto mining and enhance regulatory measures within the industry.
The current amendment builds upon the crypto taxation proposal introduced in December 2020, following a recent recommendation by the Russian Federal Tax Service to tax miners’ unrealized profits.
Additionally, authorities have introduced a power consumption cap for Bitcoin miners, allowing unregistered users a maximum of 6,000 kilowatt-hours. Plans are also underway to curb crypto mining in select regions experiencing continuous energy deficits.
