This Friday, the president of the Russian Federation, Vladimir Putin, made official the law that regulates cryptocurrencies in the Eurasian country. With the signature of the president, digital currencies are now officially recognized as a form of property in that nation. This new regulation becomes a huge step for the sector amid the rise in popularity of BTC.
According to the TASS agency, authorities now view cryptocurrencies as a form of property under foreign trade settlements. This occurs through an experimental legal regime (ERL). On the other hand, the new regulations provide that cryptocurrencies are not subject to value added tax.
Transactions with virtual currencies carried out through the RLE are also considered tax-free operations. Despite this, companies dedicated to Mining Bitcoin and other tokens must report important data to the tax authorities. For example, they must report who uses their services to obtain profitability.
If the latter does not occur within the corresponding time frames, companies could face fines of 40,000 rubles. It is worth mentioning that income from digital mining falls into the category of flexible or in-kind income. The latter means that they will be applied according to the market value. At this point, deductions related to mining expenses will be allowed.
Russia continues its Cryptocurrency legalization campaign
This new cryptocurrency law within the Russian Federation demonstrates the Kremlin’s positive approach towards these assets. The tax issue of the new regulation is one of the most striking. In that sense, income from cryptocurrency trading is subject to two levels of personal taxes.
In this context, the turning point is 2.4 million rubles. Thus, marketing with income below that mark must pay a 13% tax, while income above the amount faces a 15% tax burden. At the corporate level, taxes are higher.
Bitcoin mining companies are subject to a standard 25% tax starting in 2025, according to the TASS publication. An important aspect to consider is that this new regulation generally comes into effect at the time of official publication. This means that Russia already has a regulatory law for cryptocurrencies.
The case of mining is one of those that receives the greatest attention from the authorities. Thus, people and entities engaged in this business have restricted access to several advantageous tax regimes. Furthermore, it is highlighted that the patent or self-employed system does not apply to participants in digital mining.
This new regulation could already be seen coming since Putin himself signed a law in August that promoted progress towards regulation.
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