Russia has proposed a new digital currency law

Russia proposes jail time for undeclared wallet owners

Russia’s Finance Ministry has proposed a new bill that would make it mandatory for digital currency owners to declare their holdings to tax authorities or face jail time. The proposed bill says that any individual or business that has received 100,000 rubles (around $1,300) in digital currency within one year would have to declare their digital currency wallet to tax authorities. If an individual were to violate the bill, they would have to pay a fee equal to 30% (but no less than 50,000 rubles (~$650)) of the amount they received in their undeclared digital currency wallet.

If an individual or business received over 1 million rubles (roughly $13,000) in their digital currency wallet within one year, then the bill recommends they face up to three  years in jail. In addition, if the bill passes, digital currency service providers that offer their services to Russia’s residents would be required to send quarterly reports to tax authorities.

If the bill were to pass, Russian citizens and businesses would have to declare their wallets and send their first report by April 30, 2021.

Figuring out their digital currency framework

Russia is currently in the process of creating and amending its regulatory framework around digital currencies. In early August, President Vladimir Putin signed a bill that recognized digital currencies as a means of payment, means of savings, and as an investment, but prohibited Russian citizens from using digital currency to pay for goods and services in the country. 

The Russian Finance Ministry has a meeting scheduled for this week to discuss the new version of bills being proposed. The Justice Ministry confirmed that the proposed bills are under consideration, but their attitude toward the proposed bills remains unknown. However, Roman Yankovsky, a member of the commission on legal support of the digital economy of the Moscow branch of the Russian Lawyers’ Association, says that “hardly anyone will take this position seriously.”

 It is not clear what the outcome of the meeting will be, but all new bills and amendments that are approved are expected to be signed into law by January 1, 2021.

New to blockchain? Check out CoinGeek’s Blockchain for Beginners section, the ultimate resource guide to learn more about blockchain technology.