Miners must pay income tax – the Ministry of Finance considers this fair, cryptonewsherald was told in the department. The introduction of such a fee is also supported by market participants, noting that it is already being paid by large companies that place equipment for the extraction of “crypto”. In the State Duma, where the law on mining is being prepared for the first reading, they argue about the rate. They can establish either an analogue of a single tax on imputed income (UTII) – from 7 to 15%, or a profit tax – 20%, said Anatoly Aksakov, head of the committee on the financial market.
Payment for mining
The Ministry of Finance considers it fair to levy a tax on profits received from cryptocurrency mining, cryptonewsherald was told in the press service of the ministry. They noted: The tax code contains all the necessary provisions to tax the profits from this activity.
In November, the bill on mining was submitted to the State DumaHowever, it has not yet passed the first reading. The form of taxation within the framework of the law is still being discussed, Anatoly Aksakov, chairman of the State Duma committee on the financial market, told cryptonewsherald earlier. According to him, either an analogue of a single tax on imputed income will be established, where the rate varies from 7.5 to 15%, or a profit tax of 20%.
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According to the MP, thousands, if not tens of thousands of people are employed in the field of cryptocurrency mining, and many of them would like to legalize their business. Already, there are companies and individuals who voluntarily pay taxes on transactions with cryptocurrencies. Mining companies also apply and want to work in a legal environment, Anatoly Aksakov added.
Amendments to the law “On digital financial assets, digital currency and on amendments to certain legislative acts of the Russian Federation”, which relate to mining, were planned to be adopted in the first reading in December 2022, and in the revised version in the second and third readings – in January this year. However, the consideration was postponed. The bill was submitted to the State Duma by a group of deputies.
In Russia, there is currently no legislation that regulates mining activities, which causes difficulties, said Maxim Zelenevsky, Vice President of the Russian Association of the Cryptoindustry and Blockchain (RACIB) for commercial projects. He noted: in this segment, only the so-called mining hotels pay taxes as a result of cryptocurrency mining. They provide hosting services – complex placement of equipment for mining by analogy with conventional data centers. Such companies generally pay income tax of 20%.
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In the absence of clear regulations, most mining enterprises operate on this model., confirmed Oleg Ogienko, director for government relations at BitRiver (one of the largest players in the segment). According to him, this approach allows you to minimize the possible risks associated with the calculation of taxes and act within the framework of the law. BitRiver was unable to estimate how much mining companies as a whole should pay taxes at the end of 2022, however, they noted that in 2021 the company transferred them in the amount of more than 200 million rubles.
Within the framework of the draft law, mining income should be determined based on the results of the sale of digital currency and subtract expenses, including electricity, depreciation, the cost of data center services and others., says Oleg Ogienko. In his opinion, for the correct calculation of the tax base and control, it is necessary to ensure the possibility of selling cryptocurrencies in Russia, for example, within the framework of an experimental legal regime. The digital currency mined by Russian miners can provide net liquidity for settlements on foreign trade transactions. Moreover, its volume at the first stage can already reach 240 billion rubles a year, he estimated.
Which tax is better
Now it is important to enshrine the concept of mining and the status of cryptocurrencies in the law, as well as create a legislative framework for the operation of an infrastructure that allows you to store, transfer, sell and buy crypto assets, the vice-president of RAKIB for commercial projects is sure. Maxim Zelenevsky added: taxation should apply to transactions with crypto, taking into account the costs of its production, both for legal entities and individuals on general terms.
Photo: RIA Novosti / Alexei Sukhorukov
And to stimulate market participants, different income tax rates should be introduced depending on the timing of the implementation of the digital currency, says Oleg Ogienko from BitRiver. He explained: this will encourage miners to quickly sell cryptocurrency and pay tax accordingly. So, if a digital currency is sold within one year from the date of mining, a reduced tax rate can be used, if sold within two years, the standard tax rate, and after two years, an increased tax rate.
The introduction of an analogue of UTII can lead to the bankruptcy of mining companies at the initial stage of launching an investment project, since this approach does not take into account significant costs, the director for government relations at BitRiver emphasized.
However, the introduction of income tax may also have a negative impact on market participants, says Anton Kutushev, a lawyer at Anatomiya Prava LLC in the field of digital financial services and cryptocurrencies. In his opinion, this will lead to the exit of a large number of start-up enterprises from the market. It is necessary to create an individual taxation system with certain coefficients for different cryptocurrencies, since the production of “crypto units” is different. In addition, electricity tariffs should be taken into account in the taxation of mining, since the equipment consumes enormous amounts of electricity.
Photo: RIA Novosti / Alexei Sukhorukov
An acceptable level of tax may be a rate of the order of 4-10% of income, said Alexei Tarapovsky, founder of Anderida Financial Group. He added: now the filing of special declarations about cryptocurrency is not provided for by law, however, mining falls under the article “Income Tax”. Most likely, many individual miners do not pay fees and are looking for ways to avoid them, but large companies are already paying the necessary amounts, the expert said.
The Central Bank and the Federal Tax Service did not respond to cryptonewsherald’s request about what form of taxation they support under the mining law and why.
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