Currency Exchange in Russia

It is possible to prohibit cryptocurrencies in the Russian Federation has been actively discussed for the past three years. In 2015, according to the National Agency for financial studies (NAFI), the idea of prohibition was supported by 40% of Russians. Despite this, a bill banning the digital currency, thus, transactions have not been introduced to the State Duma.

At the state level in Russia, the idea of banning cryptocurrencies was replaced by the idea of regulation of crypto-currency relations. Changed the opinion of the population in 2016 only 20% of Russians supported the ban of digital money (according to the NAFI). At the same time, Russia could become the first state to adopt a law on the legal regulation of cryptocurrency and transactions.

To date, appropriate legal regulation is not developed, and the applications of regulators are informational only. Is progressive and can be considered a letter of the Federal tax service of the Russian Federation. In this regulator, in particular, noted that the legislation does not prohibit transactions using the cryptocurrency. It does not resolve the issues related to the taxation of digital currencies. For example, the problem with their taxation value added. In General apply the standard rules and tax rates, because of the special conditions of the taxation of cryptocurrency transactions law.

over the 2014-2016 Federal service for supervision in the sphere of Telecom, information technologies and mass communications ("Roskomnadzor") was blocked several news websites dedicated to cryptocurrency and distributed technology.

In January 2014, the press service of the Central Bank of Russia published information "About using in transactions "virtual currency", in particular, of Bitcoin". In the document, the press service noted that "all legal entities services for exchange of digital currency into rubles and foreign currency, as well as for goods (works, services) will be considered as a potential involvement into realization of doubtful operations in accordance with the legislation on counteraction to legalization (laundering) of incomes obtained in a criminal way and financing of terrorism". In fact, in this statement, the cryptocurrency has been equated with monetary surrogates, although no direct indication that it does not contain.

In the same month, the President of Sberbank German Gref in an interview with Bloomberg at the world economic forum in Davos, said that he had sent letters to the presidential administration of the Russian Federation, the Central Bank and Finance Ministry asking them not to impose restrictions on the use of virtual currencies and electronic payment systems. German Gref also noted that despite the fact that in the world, such technologies are developing in Russia for unknown reasons they are trying to ban. Moreover, in July at the International banking Congress, first Deputy Chairman of the Central Bank Georgy Luntovsky declared that to reject Bitcoin is impossible, because maybe for him the future.

At the end of November 2016 has been published the letter of the Federal tax service of the Russian Federation (hereinafter — the "FTS") on measures to control the circulation of cryptocurrency. The letter was the first official document defining the legal status of digital currencies and operations with them.

the Legal status of the cryptocurrency and transactions with them in Russia is not defined. Since the statement of the Central Bank, General Prosecutor's office, Federal financial monitoring service and Federal drug control service of the Russian Federation, as well as their separate representatives bore more informative than normative.

the Situation is a little clearer after the publication of the letter, on measures to control the circulation of cryptocurrency. As the letter of the regulator is, in fact, the first official document that brings clarity to the positioning of the government digital money and cryptocurrency transactions in accordance with Russian law.

And although the declarative letter to FNS, as the statements of other regulators, is for informational purposes only, in practice the tax authorities coordinate their actions with the position outlined by FNS in such letters.

In accordance with the letter:

  • Russian legislation does not contain the concepts of "cash surrogate", "cryptocurrency" and "virtual currency";
  • the Use of cryptocurrency in transactions — the basis for the consideration of the classification of such transactions (operations) for transactions (operations) aimed at legalization (laundering) of incomes obtained in a criminal way and financing of terrorism;
  • Russian Legislation contains no prohibition on the exercise by citizens of the transactions using digital currencies;
  • Developed by the Ministry of Finance bills need improvement;

the Operations related to the acquisition of crypto-currencies using the exchange values (foreign currency and foreign securities) and/or currency of the Russian Federation, and foreign exchange operations. Separately, the letter addresses the issues associated with obtaining foreign exchange control authorities information from residents and nonresidents on transactions for the sale of digital money. Getting these bodies from residents and non-residents information about transactions of purchase and sale of digital money is not provided by the existing system of exchange control. However, such information may be obtained from the authorized body in the sphere of combating legalization (laundering) of incomes obtained in a criminal way and financing of terrorism.

additionally, the legislation provides the possibility of obtaining FNS from the Federal financial monitoring service information on identified financial schemes, with signs of tax evasion, illegal VAT refunds from the budget, deliberate bankruptcy and violations of currency legislation of the Russian Federation.

the Tax legislation of the Russian Federation does not provide special rules for the taxation of cryptocurrency transactions. And suggests that because the legal status of cryptocurrencies, the Russian legislation is not defined (a digital currency not treated as currency or securities), bitcoin is subject to customary recalculation due to the rate changes

It is possible to prohibit cryptocurrencies in the Russian Federation has been actively discussed for the past three years. In 2015, according to the National Agency for financial studies (NAFI), the idea of prohibition was supported by 40% of Russians. Despite this, a bill banning the digital currency, thus, transactions have not been introduced to the State Duma.