President Vladimir Putin has officially stated that Russia will issue its own ‘CryptoRuble’ at a closed door meeting in Moscow, according to local russian news sources (via Cointelegraph). The news broke through Minister of Communications Nikolay Nikiforov.
The state issued cryptocurrency cannot be mined and will be issued and controlled and maintained only by the authorities. The CryptoRubles can be exchanged for regular Rubles at any time, though if the holder is unable to explain where the CryptoRubles came from, a 13 percent tax will be levied.
The CryptoRuble does appear to be blockchain-based, however, which gives it at least a veneer of decentralization and could help prevent things like online fraud.
Russia will try to profit and tax speculation and money laundering.
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Except the blockchain works as a transparent ledger only because the the ledger is effectively maintained and distributed by miners. If there are no public miners, then this is just classic e-money with better handling of edge case offline transactions. Doesn’t stop the government/central miner from changing reality by signing a ledger change in their favor since they maintain majority control of the ledger.
I would guess that any/all ‘official government’ cryptocurrencies are intended to justify the next logical step, of declaring that there is no need for alternative cryptocurrencies by ordinary citizens, and therefore there is no reason to allow them and given the social problems they might support, they may as well be outlawed. The state might allow corporations/organizations some limited use in order to work internationally, I suppose.
While I’m a frequent critic of Putin, this is a good, forward looking step from the Russian government. I believe the 13 percent tax is the flat rate, considerably superior to the US system of high rates & great complexity.
13% is just personal income tax. Overall, tax burden in Russia is higher than in the US and comparable to Germany. At least according to research done by, I believe, PWC… Payroll taxes paid on employer’s side, for example, are about 30%!!!
I’ll illustrate… Let’s say you are paid 100 rubles. To pay you this salary your employer will have to pay 30 rubles in payroll tax. Out of this 100 you’ll pay 13 rubles in your personal income taxes. Now, you are left with 87 rubles and 43 rubles have been paid in taxes. 43/(43+87) = 33% of total money paid went to the state.