Representatives of Moscow’s main ministries and parliament stated that under Russian law, cryptocurrency mining should be considered a corporate activity and taxed accordingly. Officials believe that regulatory measures will benefit the country and the cryptocurrency industry.

After the legalization of cryptocurrency mining, the Russian government will levy millions of dollars in taxes

Although the “Digital Financial Assets Law” that came into effect in January this year regulates certain encryption-related activities, such as “digital currency issuance,” it does not explicitly mention cryptocurrency mining. The industry remains unregulated, the Russian Ministry of Finance recently acknowledged in comments to local media.The industry continues to expand in energy-rich Russia grade In terms of global hash rate share, it is one of the top destinations in the world.

According to the Ministry of Economic Development, Izvestia wrote in an article that mining should be precisely regulated as an entrepreneurial activity that meets the legal definition of the Civil Code. It emphasized that this would allow the government to tax the income of miners and increase budget revenue. Alexei Minayev, deputy director of the Ministry of Digital Economy Development Department, told the Russian Daily:

This is an area where the state can benefit from taxation. People can legalize their income, and large companies are becoming more and more interested in this.

Valery Petrov, Vice President of Market Development and Supervision, Russian Cryptoeconomics, Artificial Intelligence and Blockchain AssociationLasibou), pointing out that miners rarely return the proceeds of minting cryptocurrency to Russia because they find it difficult to prove that these funds were obtained legally.

Annual income of Bitcoin mining (Bitcoin) Is estimated to be 19.7 billion U.S. dollars, of which Russia accounts for about 12% of the total amount, or 2.4 billion U.S. dollars. Petrov claimed that the Russian Federation has lost millions of dollars in recent years due to the government’s failure to regulate and levy taxes on the business.

The idea of ??mining as an entrepreneurial activity is supported by the Ministry of Energy, which believes that this will allow the authorities to distinguish between private and corporate electricity consumption. This move also won the support of the State Duma, the lower house of parliament. Anatoly Aksakov, chairman of the important financial market committee, said, Call For such a solution as early as September.

The legislator admitted that mining is not banned even now, but pointed out that its tax revenue is not yet clear. Aksakov also suggested that it is worth considering increasing the electricity bills of cryptocurrency miners because they are currently buying electricity at normal prices. The representative pointed out that most entities in the industry currently do not pay any taxes, adding that large mining companies want to legalize.

Faithful to its strong stance on decentralized digital currencies, the Bank of Russia stated that it does not support any initiatives to promote the emergence of “currency substitutes,” a term that is often used to describe cryptocurrencies. The Central Bank opposes legalization in the country and insists that the ruble is the only legal tender under Russian law. However, the Ministry of Finance insists that the legal status of crypto mining should be determined as part of the rules related to the circulation of digital currency.

Do you think Russia will adopt business-friendly regulations for its growing crypto mining industry? Share your expectations in the comments section below.

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