Private individuals mining cryptocurrency may expect a higher tax burden than businesses involved in the industry, a high-ranking member of the Russian parliament has indicated. While the extraction of digital currencies is yet to be regulated in Russia, authorities lean towards recognizing it as an economic activity, which will allow the government to tax mining profits.
Profits from Cryptocurrency Mining in Russia May Be Taxed Like Those From Securities
The personal income tax levy for individual crypto miners withdrawing their profits into the traditional financial system cannot be less than 15%, the head of the Industry Committee at the State Duma, Vladimir Gutenev, has recently stated. The lawmaker added that the minimum tax rate for companies or sole traders engaged in the minting of digital currencies as a business activity should be at least 6%.
Quoted by the business news portal Finmarket, Gutenev explained at a press conference that if cryptocurrencies are to be treated as securities in the Russian Federation, income tax must be paid when the mined coins are cashed out.
The deputy was referring to the mining rewards which can be received by both natural persons and legal entities. These payments for the processing of blockchain transactions are credited to cryptocurrency wallets. Miners can choose to convert the digital coins into fiat currency.