​Russia’s Ministry of Finance supports the tax rate for miners in the amount of 7-20%

What’s new? The Ministry of Finance of the Russian Federation considers it fair to impose a tax on income from cryptocurrency mining. According to the press service of the department, the Tax Code has all the necessary provisions for this. At the moment the law on mining is being prepared for the first reading, and the State Duma is discussing the tax rate for miners, which may be from 7 to 20%.

Material on the Izvestia website

What else is known? According to Anatoly Aksakov, Chairman of the State Duma Committee on the Financial Market, miners may be subject to either the equivalent of a single tax on imputed income (UTII) at a rate of 7 to 15%, or an income tax of 20%.

Aksakov also added that tens of thousands of people would like to legalize their businesses engaged in mining. Meanwhile, the amendments to the law “On Digital Financial Assets,” “On Digital Currency” and “On Amending Certain Laws of the Russian Federation in connection with the adoption of the Federal Law “On Digital Currency” have not yet been considered. The lack of legislation leads to difficulties for industry participants. For example, now companies and individuals voluntarily pay taxes on transactions with cryptocurrencies, while mining hotels are subject to a 20% income tax.

According to Oleg Ogienko, top executive of BitRiver mining company, the introduction of UTII may lead to bankruptcy, as the tax does not take into account the expenses of miners. Anton Kutushev, a lawyer of OOO “Anatomiya prava” in the field of DFAs and cryptocurrencies, stressed that the income tax may also negatively affect market participants and lead to the departure of a large number of start-up companies.

In this, the Bank of Russia and the Federal Taxation Service did not respond to journalists’ requests about what form of taxation under the law on mining they would support.

Earlier, the Ministry of Finance of the Russian Federation explained the delay in the adoption of the law on the legalization of mining. According to Deputy Finance Minister Alexey Moiseev, the bill “stalled” due to disagreements between the department and the Central Bank and law enforcement agencies.

From 2017 to 2021, revenue from bitcoin mining in the Russian Federation increased 18-fold, from 7 to 128 billion Russian rubles, and the energy consumption of miners increased 20-fold.

In July 2022, the Federation Council of the Russian Federation passed a law on the taxation of transactions with digital financial assets (DFAs). The income tax rate for Russian operators will be from 13 to 15%.

For how the mining industry works in Russia, as well as attempts to regulate cryptocurrencies in the country, read GetBlock Magazine’s special materials.