Russia to Impose Tax on Withdrawal of Cryptocurrencies into Rubles

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Key Takeaways:

  • The Ministry of Economic Development of Russia wants to impose a tax on the conversion of cryptocurrencies into rubles.
  • The Central Bank of the country is opposed to this proposal. 

In today’s report to Izvestia, the Ministry of Economic Development of Russia proposed introducing taxes while converting cryptocurrencies into rubles. 

Crypto mining consumes a lot of energy and has been facing several obstacles from the legal perspective. As a solution to these, along with imposing the tax, the Ministry has also asked only to allow mining in those regions where there is a surplus of electricity, to charge less for electricity, and also to bring down costs for connecting mining farms and data processing centres to energy sources. 

However, the Central Bank of Russia is opposing this proposal. According to the experts, these actions by the Ministry will “shadow mining and introduce crypto into the legal field, but will limit the production of digital currencies.” Therefore, taxes should be imposed only on operations and not every transaction.

The Central Bank sense risk in converting digital currencies into rubles. Therefore, the Ministry has decided to develop measures to regulate crypto by allowing all transactions only through Russian banks. The regular will also have the power to decide eligible and ineligible investors by identifying the holders of the respective crypto wallets. 

Both the Government and the Ministry of Finance oppose the ban of cryptocurrency. A bill is expected from the agency and the Central Bank by February 18, further deciding the fate of digital currencies in the country. 

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Shreya Bhattacharya

A journalist & writer exploring new topics every day!