Russian Government Introduces New Tax Laws for Cryptocurrency Mining
Russia has advanced a proposal to amend its cryptocurrency mining legislation, introducing new rules for taxing Bitcoin (BTC) mining, transactions, and mining infrastructure operations. The Ministry of Finance announced the proposal, which sets clear guidelines for taxing income and expenses in the cryptocurrency mining sector.
Cryptocurrencies Defined as Property for Tax Purposes
Taxation Based on Market Value
Under the new rules, cryptocurrencies will be classified as property. Income from mined cryptocurrencies will be taxed based on their market value at the time of receipt. Miners will also have the ability to deduct expenses related to mining from their taxable income.
Cryptocurrency Transactions Exempt from VAT
The amendments clarify that cryptocurrency transactions will not be subject to value-added tax (VAT). However, income from these transactions will be taxed alongside income from securities trading. The highest proposed personal income tax rate on cryptocurrency profits is set at 15%.
New Obligations for Mining Infrastructure Operators
Requirement to Report Users
Operators of cryptocurrency mining infrastructure will be required to report individuals using their facilities for mining to tax authorities. Specific details about the information operators must disclose have not yet been clarified.
Cryptocurrency Mining Restricted to Registered Entities
New Limits and Restrictions on Mining
As of November 1, cryptocurrency mining is legal in Russia only for registered individual entrepreneurs and organizations. Those without business status are allowed to mine cryptocurrencies but are limited to a monthly electricity consumption of 6,000 kWh.
Temporary Bans in Certain Regions
Due to electricity shortages, the Russian government is introducing temporary bans on cryptocurrency mining in certain regions. These bans will be in effect from December 1 to March 15, 2025.
Summary: Russia Tightens Rules for Cryptocurrency Mining
New rules for taxing and regulating cryptocurrency mining in Russia establish clearer conditions for miners. The introduction of a 15% tax on cryptocurrency income and restrictions on mining in certain regions reflect the government’s effort to regulate and control the sector. Mining will remain possible only for registered entities, while the government also implements measures to reduce the strain on the energy infrastructure.
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