- Russia has officially recognized cryptocurrencies like Bitcoin (BTC) as a form of property under a new law approved by President Vladimir Putin.
- The law exempts cryptocurrency mining and sales from value-added tax (VAT), potentially promoting increased adoption and use of cryptocurrencies.
- A two-tiered tax system will apply to individuals buying, selling, or trading cryptocurrencies, with rates of 13% for income up to 24 million rubles and 15% for amounts above that.
The Russian government has passed a new law that legally defines cryptocurrencies like Bitcoin as property. This is a major development that could increase crypto adoption in the country.
New Law Focuses on Crypto Mining
The law excludes cryptocurrency mining and sales from value-added tax (VAT). This tax exemption could encourage more people and businesses to get involved with cryptocurrencies.
Miners’ income will be taxed as “income in kind” at market rates, with deductions allowed for mining costs. Corporate miners will start paying a 25% tax on revenues in 2025.
Mining operators must disclose which companies use their services. Failure to provide this information on time can result in a 40,000 ruble fine.
Two-Tiered Tax System for Crypto Profits
The law establishes a two-tiered tax system for those who buy, sell or trade cryptocurrencies:
- 13% tax on income up to 24 million rubles
- 15% tax on income beyond 24 million rubles
This provides clarity on how crypto profits will be taxed.
Analysis of the New Law
The law enables digital currencies to play a bigger role in Russia’s economic policy while strengthening government oversight.
Along with Donald Trump, Vladimir Putin is emerging as a pro-crypto president. The law could also be a step toward de-dollarization.
Overall, the legislation sheds light on how Russia aims to control and benefit from the cryptocurrency industry. By embracing crypto, the government may be able to reduce reliance on the US dollar.
