Daniil Egorov, Head of Russia’s Tax Service, said in an interview with Russian news agency RBC that cryptocurrencies are a potential threat to the tax system.
Stating that the potential use of cryptocurrencies in tax evasion is high, Egorov said that they do not want to lose tax revenues, which is one of the important income sources, and that they actively monitor cryptocurrencies and the market.
“We think cryptocurrencies could significantly erode the base of the tax system, so we are watching the crypto market closely.”
Stating that crypto currency transactions should be reported, President Egorov stated that the Russian Federal Tax Service (FTS) is ready to implement systems to process large volumes of cryptocurrency transaction data.
Since cryptocurrencies have a high potential to be used in tax evasion and illegal crimes, states are working on taxing cryptocurrencies exceeding a certain amount.
In Russia, one of the countries working on taxation, the Russian State Duma (House of Representatives) approved a bill in February 2021 on the taxation of crypto transactions exceeding $7,800 per year.
The approved bill was sent to the State Duma Committee on Budget and Taxes, the responsible committee.