Russia’s Finance Ministry Outlines Preliminary Scheme for Taxing Cryptocurrencies

The Russian Finance Ministry has proposed levying a tax on the revaluation of cryptocurrency for companies. Forbes сообщает.

According to Deputy Finance Minister Aleksey Moiseev, they based the scheme on the bill on taxation that was approved in the first reading. The new provisions are likely to enter the document as amendments.

The main change concerns introducing a tax on the revaluation of digital currencies for exchanges, exchangers and mining farms.

“Even if companies did not sell cryptocurrency, in July they will have to revalue its value on their accounts and pay the tax,” Moiseev said.

The ministry does not propose collecting property tax on cryptocurrency to avoid increased burden. Corporate entities could also be exempt from VAT. To this end, work with cryptocurrency would be recognised as financial services, which, by analogy with the banking sector, would allow not to charge the tax, according to the deputy minister.

From individual investors, NDFL would be collected after the sale of cryptocurrency.

“If a person bought Bitcoin for $100 and sold it for $200, then in July they must pay 13% tax on the $100 profit. The tax must be paid in the usual manner by July 15,” Moiseev said.

The Russian Finance Ministry estimates tax revenues to the budget from legalising the cryptocurrency market at 10-15 billion rubles, with the main share of payments to come from miners.

At the same time, the ministry is discussing limiting the maximum amount of investments in cryptocurrencies for non-qualified investors на уровне 50 000 рублей.

Yet to obtain the status of a qualified investor for buying cryptocurrency, the requirements are tougher than in the traditional financial environment.

“It will not be enough simply to have 6 million rubles in the account,” Aleksey Moiseev said.

Currently, to obtain the status of a qualified investor, a participant in the traditional market must meet one of the following conditions:

• have assets valued at 6 million rubles or more on accounts;
• conduct deals with securities for at least that amount over the last four quarters (the total number of deals must be more than 40);
• have a specialized education, experience working in financial companies or a certificate of a financial market specialist.

On 15 February, a government meeting will be held with Finance Minister Anton Siluanov, Deputy Prime Minister Dmitry Grigorenko and Central Bank head Elvira Nabiullina on the topic of cryptocurrency turnover.

Earlier, on 17 February 2021, the State Duma in the first reading approved a government bill on taxation of cryptocurrency operations.

In its current draft, the document obliges individuals and legal entities to report to tax authorities about ownership of digital currencies if the amount of receipts or withdrawals for the year exceeds the equivalent of 600 000 rubles. The amount of the operation is calculated based on the market price of the currency.

According to the recent proposal by Vladimir Gutenev, head of the State Duma’s Committee on Industry, NDFL on converting cryptocurrencies to fiat cannot be less than 15%, and the minimum tax rate on profits for mining companies and IPs must be at least 6%. Market participants disagree on the proposed rates.

Earlier, РАKИБ proposed its own taxation scheme for cryptocurrencies and mining.

According to analysts’ earlier estimates, even under a simplified taxation regime, the amount of taxes collected from the Russian crypto market could reach up to 1 trillion rubles per year.