What Miners and Traders Need to Know

Russia is making headlines with a bold new tax bill that could transform how cryptocurrency mining and trading operate in the country. The Federation Council, the country’s upper house of parliament, has given the green light to the bill, which sets the stage for tighter regulations on digital currencies. All that’s left now is President Vladimir Putin’s signature to make it official.

But why is Russia, a country often cautious about digital currencies, pushing for such a sweeping reform now? And how will these changes impact miners and traders? Read on for the answers.

Playing the Crypto Game to Survive

Russia is making all the efforts to stay alive in the crypto game with clear policies and transparency, yet making money out of the crypto. This will help the country fight with economic challenges it faced in recent times with US sanctions. This came into effect with Trump’s winning the white house no country can afford to stay away from this trillion-dollar industry. 

The Bill at a Glance: Key Details

The bill simplifies crypto taxation by classifying digital currencies as property. While this means crypto transactions will be taxed, there’s a significant benefit: transactions will be exempt from value-added tax (VAT).

For the first time, cryptocurrencies will be officially recognized as “property” under Russian law, ending years of legal ambiguity. The bill also introduces a tiered tax system for miners:

• Earnings up to 2.4 million rubles (~$21,210) will be taxed at 13%.
• Earnings above this amount will face a 15% tax rate.

Stricter Reporting and Penalties

In addition to taxes, the bill enforces stricter reporting requirements. Mining companies must report client information to tax authorities. Miners will also need to disclose their activities to the Federal Tax Service (FTS), and failure to do so could result in fines of up to 40,000 rubles (~$354).

Income from mining will be taxed based on the market value of the cryptocurrency at the time it is received. While miners selling tokens through exchanges will benefit from VAT exemptions, the new rules leave little room for avoiding oversight.

Caps on Small-Scale Mining

Earlier this month, Russia introduced additional measures to control unregistered Bitcoin mining. Individuals without proper registration will now face energy consumption limits of 6,000 kilowatt-hours per month. This effectively caps small-scale mining operations.

What’s Next for Russian Crypto?

With both the State Duma and the Federation Council backing the bill, it now awaits President Putin’s approval. If signed, it will significantly change the regulatory landscape for Russia’s crypto market. As reported by Komsomolskaya Pravda, traders and miners should prepare for stricter oversight and a more structured environment.

Russia’s new bill might just be the push the crypto industry needs to evolve in a more structured way. Watch the developments closely!