Russia’s tax authority keeps reporting requirements for cryptocurrency holders

The draft law introducing a tax on cryptocurrency transactions in Russia has not undergone significant changes ahead of the second reading and provides for an obligation for citizens to inform the Federal Tax Service about holdings of digital assets. About this сообщает «Коммерсант».

The publication cites a scan of a letter from the Federal Tax Service (FTS) to ANO ‘Digital Economy’, which had previously sent its objections to the document’s text, circulating in Telegram channels. The FTS did not comment on the letter’s origin, but ANO ‘Digital Economy’ confirmed its authenticity.

According to the document, the bill is designed to enable tax authorities to obtain information about open cryptocurrency wallets of legal entities and individuals. Accordingly it provides for ‘an obligation for citizens to report ownership of digital currency’.

At the same time the ‘On Crypto Assets’ law guarantees legal protection for holders of digital currency, provided they inform about owning digital currency and conducting operations with it.

“The Tax Code of the Russian Federation must provide for the procedure of informing. The draft federal law establishes such a procedure and does not hinder voluntary disclosure. Therefore, although the bill was not developed in pursuance of Law 259-FZ [On Crypto Assets], it fully conforms to the provisions and does not contradict it,” the letter from the FTS says.

The FTS also explained that, with the permission of the head of the superior tax authority and where there are signs of tax law violations, the agency may request statements on transfers and operations related to digital currency on the bank accounts of individuals who are not sole proprietors.

Commenting on the FTS letter, ANO ‘Digital Economy’ said it hoped the agency would provide a transition period for the introduction of such ‘sensitive’ regulatory provisions. Otherwise, it would hinder citizens and business in determining the legality of their actions.

Письмо ФНС by ForkLog on Scribd

Earlier, on February 17, the State Duma of the Russian Federation, in the first reading adopted as the basis the bill on taxation of cryptocurrency operations.

Under the current version, individuals and legal entities are required to report to the tax authorities on holdings of digital currencies if the annual inflows or outflows amount to the equivalent of 600,000 rubles. The amount of the operation is calculated based on the market price of the currency.

A penalty of 10% of the larger of the two sums — inflows or outflows of digital assets — is provided for late submission or for submitting inaccurate information in the report on digital currency transactions and their balances.

Earlier, the Council on Codification did not back the tax amendments due to terminology issues, and the Legal Department of the State Duma of the Russian Federation sent the bill back for revision due to arbitrary fines. Experts also noted that, in essence, taxpayers are imposed with an obligation rather than a right to report their ability to dispose of digital currency.

For more on how the cryptocurrency taxation bill will affect its holders, read ForkLog’s article:

A lawyer explained how the cryptocurrency taxation bill will affect its holders

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