Russian federal government has submitted a draft law to the State Duma that introduces rules for taxation of transactions involving cryptocurrency. This bill will amend Russia’s tax code in order to address a variety of questions.
One aspect of this is the value-added tax (VAT). The authors suggest that VAT be applied to services offered by platforms for exchanging or issuing digital financial assets (DFA) by the operators. This term encompasses cryptocurrencies under current Russian law.
Forklog reported that the tax base for “digital rights”, another legal definition that includes security and utility tokens will be the difference between the purchase price and the sale price, citing the document.
Russian entities that own tokens will pay 13% on the revenue from digital rights, while foreign companies will pay 15%. Digital financial asset issuers will have to file tax reports detailing the parties and transactions during the current year. This must be done by February 1, 2019.
According to Andrey Tugarin (managing partner at GMT Legal), the law will not apply to Russians who hold cryptocurrencies. The bill only affects the digital rights and market for digital financial assets, he explained. It introduces a tax regime that mirrors the one in place for the securities market.
The Russian government will also file a new draft of the law “On Digital Currency” in parallel to the tax bill. This was recently revised and submitted by the Ministry of Finance to the cabinet. While the Bank of Russia is opposed to legalization of cryptocurrency, the department supports it.
The State Duma will likely approve both pieces of legislation during its spring session. These laws will be added to the law “On Digital Financial Assets”, which was enacted in January 2021 but only partially regulates the country’s crypto industry.