Russia has been doubling down on its interest in cryptocurrencies like Bitcoin (BTC). According to recent reports, digital currencies are now formally recognized as a type of property in international trade settlements. This falls under a new law that has now been approved by Russian President Vladimir Putin. The President has jumped into the scene by embracing cryptocurrency for trade. This is being carried out under an experimental legal regime (ELR).
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Russia’s Brand New Law Focuses On Mining
The laws exclude cryptocurrency sales and mining from value-added tax (VAT). Without the tax burden that usually comes with traditional financial transactions, this exemption could push people and businesses to interact with cryptocurrencies more freely. Cryptocurrency miners’ income is categorized as “income in kind” and is subject to market-rate taxes, with deductions allowed for mining costs. Furthermore, it should be noted that corporate organizations will begin to pay taxes on their mining revenues at the usual corporate rate of 25% in 2025.
But, operators of mining facilities in Russia must, however, disclose to tax authorities that utilize their services. A punishment of 40,000 rubles might be imposed on anyone who does not provide this information on time.
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Tax on Cryptocurrency Profits
The Russian law’s explicit structure for taxing cryptocurrency revenues is one of its most notable aspects. A two-tiered tax system will apply to anybody who purchases, sells, or trades digital currencies like Bitcoin. This means 13% for income up to 2.4 million rubles and 15% for any amount beyond that.
The latest law sheds light on an array of factors. The law allows digital currencies like Bitcoin to play a bigger part in Russia’s economic policy while also strengthening its hold over the industry. Alongside, Donald Trump, Putin has been emerging as a prominent pro-crypto president. In addition, Russia’s latest move is also being considered as a jump towards de-dollarization.
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