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Russia planning to introduce tax on cryptocurrencies

Crypto currency can be introduced into Russian law as “newly created” (includes property independently produced by a citizen)

The Russian Banking Community has found a way to legalise cryptocurrencies. To do this, it is necessary to legally recognise the mining of digital money as an analogy of the occupation of property or treasure.

"Legally, it could be argued that the first owner of the cryptocurrency "found them", because the receipt from an anonymous system can be conditionally considered a finding,”— EhakingNews quoted the ARB report on «The Concept of Decentralized Cryptocurrency Turnover». Discussion of this document is scheduled for 8 October.

However, the acquirer of digital money does not just seize or find them as a ready-made object. Cryptocurrency arises as a result of mining, that is, human activity. In fact, he creates it himself, explained Anatoly Kozlachkov, the author of the report, Vice-President of ARB.

Based on this, cryptocurrency can be introduced into Russian law as “newly created” (includes property independently produced by a citizen).

Then it can be used in barter transactions and taxed, said Anatoly Kozlachkov.

This is a fair approach, said Andrey Ermolaev, partner of KPMG. According to him, it is impossible to equate cryptocurrencies with ordinary money because it is an investment, and the growth of the value of the paper is always considered as a taxable base.

According to a legal expert Elena Avakyan, an example is a German model involving the payment of tax in the cryptocurrency in which the income is received.

Yuri Brisov, founder of LFCS (Legal Support), called the ARB proposal "the biggest mistake in the list of initiatives of all the time".

"Cryptocurrency received as a result of mining is a payment of remuneration, but not a finding," explained Brisov.

Synergy Research Group Deputy Director-General for Legal Issues and Technologies, Peter Lyalin, also sharply criticized the proposal of the Association of Russian Banks (ARB). He proposed to equate mining to the production of goods, as is practiced, for example, in Australia and Canada.

"I consider the initiative unworked and superficial. It seems that such a proposal was made without taking into account the specifics of the mining as a cryptocurrency mining activity," the expert suggested.

Experts agreed that the initiative of the Association of Russian Banks (ARB) requires further refinement.
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