The world’s largest country is moving closer to setting up crypto taxation laws after the lower representative house. State Duma passed the first reading on the draft bill affecting digital assets. The crypto tax bill, introduced to parliament by the government, aims to recognize cryptocurrency assets like Bitcoin and Ethereum as property to apply the Tax Code, the report reads.

According to Prime Minister Mikhail Mishustin, these new laws will enable crypto owners to have a legal standpoint in court and defend themselves as property.

Additionally, the new amendments to the Tax laws state that income from cryptocurrency transfers and transactions will be liable to property or income tax payments. Citizens and organizations will also have to declare any transfers above 600,000 rubles (~$8,200) per year. However, digital asset transactions will not be liable to VAT and depreciation.

According to the report, non-payment or incomplete payment of the tax on digital assets will attract a penalty of 40% of the required amount. Lack of reporting, untimely submission, or submission of a declaration with inaccurate information will attract a 10% fine on the amount required by the government.

In the second reading, the State Duma plans to release a comprehensive report clarifying which digital asset transactions are tax-exempt, who submits the reports to the tax office, and how to inform authorities on disposing of the assets.

The newly amended bill does not change President Putin’s signed law requiring Russian state officials to disclose their digital asset holdings and maintains digital assets are not a legal means of payment.

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