Russian lawmakers have passed a groundbreaking crypto tax bill, introducing levies of 13% to 15% on Bitcoin miners’ revenues. The legislation also formally recognizes cryptocurrency as “property” for the first time, providing legal clarity for the nation’s burgeoning crypto sector.

Tax Structure for Miners

Under the new law, miners earning up to 2.4 million rubles ($21,210) annually will pay a 13% tax. Those exceeding this threshold will face a 15% rate. However, miners are exempt from paying value-added tax (VAT) when mining tokens and selling them on crypto exchanges.

Fresh US sanctions against Russian banks have caused a further slide in the ruble, putting at risk some of the last channels of direct foreign-currency flows into the country https://t.co/uzPzsBrCkM

— Bloomberg (@business) November 27, 2024

Failure to report mining operations to the Federal Tax Service (FTS) will result in fines of up to 40,000 rubles ($354). The tax rules follow the recent legalization of crypto mining in Russia, which came into effect on November 1, 2024.

Rapid Implementation and Permits

The tax bill, approved by the State Duma, is now awaiting the Senate’s endorsement and President Vladimir Putin’s signature, expected in the coming days.
Since the legalization of mining, over 150 firms have applied for operating permits, and more are anticipated. The government has also temporarily restricted mining in energy-strained regions during winter months.

Rising Demand for Mining Hardware

The crypto mining sector in Russia is witnessing a surge in activity. Weekly purchases of mining rigs have skyrocketed from 30 in mid-2024 to 600 in November, according to Moscow-based Mining Group. The spike in demand has driven mining hardware prices up by 10%-15%.

Irkutsk: Russia’s Mining Hub

Irkutsk, often dubbed Russia’s Bitcoin mining capital, continues to thrive despite challenges. Illegal mining in the region has strained Siberia’s power grid, adding pressure on energy suppliers.

With competitive energy costs and high mining profitability, Russia is poised to solidify its position as a key player in the global crypto mining landscape.

The new tax framework marks a significant step towards regulating the industry while balancing the nation’s energy and economic interests.