There is no unique approach when it comes to regulating the crypto industry. Interestingly, the county that has a huge potential to develop this industry, continues to surprise with its decisions. For example, in early September Russia’s Ministry of Finance proposed a blanket ban on any crypto transactions. With the exception of obtaining cryptocurrency through three methods.
Let’s have a look at the exceptions. The first method is inheritance, and the second method is bankruptcy. The last one is the enforcement proceedings.
Interestingly, the Russian ministry now reportedly doest not stop there and came with other proposals. For example, the ministry wants to introduce criminal liability for failure to declare taxes on crypto, including prison terms of up to three years.
Notably, people who fail to report an amount of more than 1 million Russian rubles ($13,000) in annual crypto operations, should serve a three-year prison term according to the proposal. Also, another form of punishment is hard labor.
Crypto and the Russian legal system
The Ministry of Finance also did not forget about the smaller amount. Interestingly, the ministry proposed fines for smaller unreported amounts as well.
Thus, any physical or legal entity in the country would have to report their annual crypto income if the amount is bigger than 100,000 rubles ($1,300).
For instance, if an individual or a legal entity fails to declare this information, the Russian ministry wants to impose a fine on such individuals or entities. People should take into account that, they will have to pay 30% of the total amount of crypto assets held, but no less than 50,000 rubles.
The Ministry of Finance also proposed another novelty. The ministry wants to require local cryptocurrency exchange services to report on taxes every quarter.
Last but not least, the current version of the law “On Digital Assets” does not provide taxation rates for crypto. Furthermore, the bill signed into law by the Russian Vladimir Putin does not mention general rules to report those transactions.