Russia is preparing to implement a 15% tax on all cryptocurrency mining and trading activities. The move aims to strengthen a regulatory framework that supports the growing digital assets industry.
15% tax on cryptocurrency trading and mining activities
According to Interfax, the Russian government has done so consent Draft amendments to the draft law imposing taxes on income and expenses from mining and trading of digital assets. It is worth noting that the Ministry of Finance is working to classify digital assets as property for tax reporting purposes.
Under the proposed amendments, income generated from mining and trading digital assets will be taxed at 15%. This initiative aims to create a fair and business-friendly tax system for the expanding cryptocurrency industry.
For miners, the taxable amount will be determined based on the market value of the underlying digital asset at the time it is received. Additionally, miners can deduct expenses incurred during their operations from their taxable income.
It should be noted that digital asset transactions will be exempt from value added tax (VAT). Instead, income from cryptocurrency transactions will be treated similarly to income from securities transactions. As a result, the maximum individual tax liability from digital asset transactions will not exceed 15%.
Operators of digital asset mining infrastructure must also report miners to tax authorities. The Russian Ministry of Finance explained:
As a result of discussions with companies, a decision was made on the advisability of imposing a tax on the financial result from mining as the fairest reflection of the results of this activity. This approach aims to monitor the balance between corporate and state interests.
How does it compare to taxes on digital assets globally?
Russia’s proposed tax rate of 15% is relatively moderate compared to digital asset taxation policies in other countries. For example, in 2022, India foot A flat 30% tax on any profits from cryptocurrency trading or sales and a 1% tax deducted at source (TDS) on transactions exceeding $590 per year.
Recently in Europe and Italy Reviewer Its previous plan to impose a 46% tax on crypto capital gains. The country is now considering reducing the tax rate by 28% so as not to stifle its emerging cryptocurrency ecosystem.
A more radical approach to virtual asset taxation has been observed in Denmark. The Danish government is forecast To implement a 42% tax rate on unrealized cryptocurrency gains from 2026 onwards.
Another European country, the Netherlands, takes a more nuanced approach to taxation of virtual assets. The Dutch government recently male It invites the public to receive comments on its proposed tax policy before its implementation.
Meanwhile, newly elected US President Donald Trump announced plans to make the country the “cryptocurrency capital of the world.” Trump did Suggested To remove all capital gains taxes on Bitcoin (BTC) transactions when used for purchases.
The United Arab Emirates has removed the Middle East value-added tax on all cryptocurrency transactions and transfers, enhancing its reputation as a cryptocurrency-friendly country. Bitcoin is trading at $92,488 at press time, up 2.2% in the past 24 hours.
Featured image from Unsplash.com, chart from TradingView.com