Russian cryptocurrency investors have started complying with authorities to provide information about their crypto dealings and pay the stipulated taxes.
According to a report by local news outlet Izvestia, several accounting and legal firms, including FTL and PwC, noted that they had recorded a surge in compliance with the tax legislation.
The development comes on the heels of Russia’s State Duma approving a bill to legally recognize cryptocurrencies as properties.
While the initiative would grant Russian crypto owners the right to legal protection, it would also enable regulators to impose a 13% tax on gains made from cryptocurrency investments.
As part of the legislation, Russian crypto owners residing in and outside the country will be mandated to declare transactions that exceed 600,000 rubles ($8,184) per year.
The regulators warned that investors who failed to disclose information about their crypto investments would be slammed with a 10% fine of the undeclared amount.
Furthermore, the bill stressed that a 40% penalty will be issued to investors who fail to pay the stipulated tax or to those who make incomplete payments.
These strict conditions have sent chills down the spines of several Russian investors, as they fear regulators will not fail to implement the punishment.
Maria Kukla, a partner of FTL Advisers, commented on the development:
We observe that Russian residents have begun to voluntarily reflect income from operations with cryptocurrency in tax returns.
Although there has been an increase in the rate at which Russians are disclosing their crypto portfolios to tax authorities, Kukla said it is too early to conclude that the initiative has been embraced by all investors.
She noted that the trend may change before the end of the tax filing campaign, adding that some investors are still waiting to know if the punishment for not participating in the exercise will be implemented.