On Tuesday, Russia approved a draft law that aims to potentially free issuers of digital assets and cryptocurrencies from value-added tax (VAT).

Lawmakers agree on VAT exemptions for digital assets issuers

According to a recent report by Reuters, lawmakers in Russia have agreed to pass the proposal to exempt digital asset issuers from VAT. 

The proposed law, which State Duma members passed in the second and third readings on Tuesday, offers value-added tax exemptions for those who issue digital assets and those who manage the information systems involved in issuing them.  

The proposal also specifies tax rates for income made from the sale of digital assets. As with standard assets, the current transaction rate is 20%. Under the new proposal, there will be a 15% tax for foreign companies and 13% for Russian companies.

Notably, the drafted proposal still needs to be approved by the upper house and signed by Vladimir Putin.

Russia’s shift in stance 

Russia has long voiced its mistrust of cryptocurrencies, with Central Bank citing concerns over financial stability. However, in February, CBR approved blockchain platform Atomyse Russia to exchange digital assets in the country. Moreover, it also gave license for dominant lender Sberbank to issue and exchange digital assets.

Due to the events in Ukraine, massive Western sanctions have touched the core of the country’s financial system, and the government is rushing to pass new laws to lessen the effect.

Vladimir Putin, the president of Russia, recently accused the United States and other G7 countries of causing the recent sanctions against the country, which led the world to experience scenarios of global inflation.