Bill set for approval in Russia's State Duma, expanding tools for managing liquidity
The Russian digital asset market could see a significant boost if tax barriers for investors are removed, according to Sergey Ryabov, head of the crypto asset department at VTB. In a statement made on September 11, Ryabov suggested that the market could grow fivefold to reach 3-5 trillion rubles in the stock market today.
Ryabov's statement highlights the current underutilization of the Russian digital asset market, which is predominantly dominated by banks as issuers. He mentioned that the demands of the real sector remain unmet in this market, and tax inefficiency is a major hindrance.
Anatoly Aksakov, Chairman of the State Duma's Financial Market Committee, is one of the initiators of the proposed legislative amendments aimed at addressing this issue. These amendments would enable professional participants to fully utilise the financial market infrastructure alongside repo and bank deposits.
The proposed changes would simplify operations, speed up settlements, and enhance transaction transparency. They would also allow professional participants to conclude securities lending agreements on organised exchanges with a qualified central counterparty and conduct clearing.
Currently, Russian tax residents can exempt income from securities sales from VAT if they have owned them continuously for more than five years. This exemption will also apply during periods when securities are temporarily transferred under a loan agreement with a broker or a repo deal.
Ryabov's statement implies that the removal of tax barriers could stimulate the growth of the Russian digital asset market. Aksakov, in a post on his Telegram channel, noted that these amendments would enable professional participants to fully utilise the financial market infrastructure, which could lead to increased interest from corporate clients.
However, it's worth noting that the other initiator of the proposed law amendment for tax exemption on income from the sale of shares continuously held by Russian taxpayers for more than five years and held under a loan or repo agreement with a broker is not explicitly named in the provided search results.
The growth potential of the Russian digital asset market, as suggested by Ryabov, is significant. If these legislative amendments are passed and tax barriers are removed, the market could indeed see a significant boost, reaching up to 5 trillion rubles in the stock market today. This would be a major step forward in the development of the Russian digital asset market and could attract more participants and investment.
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