In Russia, lawmakers propose banning cryptocurrency circulation and requiring tax reporting by miners

The State Duma of the Russian Federation has registered a bill regulating mining and the subsequent sale of mined cryptocurrencies. It amends the law on digital financial assets (DFA), in force since January 2021.

The requirements for the activities of miners will be set by the government in consultation with the Central Bank. Enforcement will fall to a federal executive body authorised by the cabinet.

The document obliges individuals and legal entities to report to the tax authorities on mined cryptocurrencies, indicating the address to which proceeds are credited.

Cryptocurrencies obtained through mining are to be sold “without using the Russian information infrastructure” — i.e., can be sold on foreign platforms. In such a case, provisions of the currency control law do not apply to the transaction.

Another means of dealing with mined cryptocurrencies is through an authorised organisation within the framework of an experimental legal regime.

The amendments to the law “On DFA” also envisage a ban on advertising or offering in any form digital currencies, goods and services related to their issuance and circulation, while making an exception for mining. The main document previously prohibited only the dissemination of information “about the offer and acceptance of digital currency” as a means of payment.

The explanatory note states that enacting the regulatory act would smooth legal risks and allow miners to “legally carry out activities, declare income received, and also pay taxes”.

If adopted, the law would come into force on 1 January 2023.

As reported, the current version takes into account the views of the Central Bank and the Ministry of Finance.

Earlier in October, the State Duma of the RF in the first reading rejected the mining bill, proposed by deputies from the New People party.

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