Facing Western Sanctions, Russian Parliament Passes Law To Eliminate VAT On Crypto Assets And Cryptocurrencies

Faced with western sanctions, Russia softens its Crypto Law. (photo: doc. pixabay)

JAKARTA - Russian lawmakers on Tuesday, June 28 have approved a bill that could potentially exempt issuers of digital assets and cryptocurrencies from the country's value added tax.

Russia has long voiced skepticism about cryptocurrencies and other digital assets, as Russia's central bank expressed concern over the stability of digital finance.

But in February regulators granted blockchain platform Atomyze Russia its first license to become an official digital asset exchange agency. The same license will also soon be granted to the country's dominant lending bank, Sberbank.

Unprecedented Western sanctions against Russia have hit the heart of the Russian financial system over the war in Ukraine. Now Russian lawmakers, the Duma, have struggled to bring in new legislation to soften the blow from the sanctions.

The bill, which was approved by State Duma members in their second and third readings last Tuesday, considers exemption from value-added tax for digital asset issuers and information system operators involved in their dealings.

The law also stipulates a tax rate on income earned from selling digital assets.

The current rate on transactions is 20%, the same as for standard assets. Under the new law, the tax will be 13% for Russian companies and 15% for foreign companies.

As reported by Reuters, the draft still has to be reviewed by the upper house and signed by Russian President Vladimir Putin to become law.