The law pertaining to financial digital assets, which took effect in January, regulates some crypto-related activities, but cryptocurrency mining is not explicitly covered.
Several Moscow-based members of parliament and key government officials have suggested crypto mining should be classified as an entrepreneurial activity under Russian law and taxed accordingly.
The Ministry of Economic Development has stated in an article published in Izvestia, a daily broadsheet newspaper in Russia, that mining should be regulated precisely as an economic activity under the Civil Code.
The letter emphasized that this would allow the government to tax miners’ revenue and increase its budget revenue. This will make it possible for the state to earn tax revenue while allowing the people to legalize their income.
It has been estimated that mining bitcoin (BTC) alone brings in $19.7 billion a year, with Russia contributing approximately $2 billion to the total amount.
Valeriy Petrov, vice president for market development and regulation at the Russian Association of Cryptoeconomics, Artificial Intelligence and Blockchain (Racib), noted that cryptocurrency miners rarely return cryptocurrency profits to Russia since it is difficult to prove the funds are legal. Because of this, he claims, the Russian government has failed to tax and regulate the business, causing millions to be lost.
The Ministry of Energy believes that recognizing mining as an entrepreneurial activity would allow them to differentiate between private and corporate electricity consumption.