Russia's tax agency is encouraging its citizens to report the purchase or sale of digital currencies as currency transactions.

In a tax letter obtained by CoinDesk dated this May, the Ministry of Finance's Federal Tax Service responded to an electronic query on the subject in which it issued new guidance. The statements come amid larger debates domestically about whether bitcoin and other digital currencies should be banned entirely or allowed for specific uses.

The letter includes language describing how the agency treats the purchase and sale of digital currencies between Russia citizens and non-citizens as currency transactions.

A translated copy of the letter states:

The letter is notable given how the exact definition of a digital currency remains largely in flux globally.

While in some countries units of blockchain-based code are considered a form of payment instrument, some US agencies consider it a commodity or form of property.

The letter goes on to stipulate that Russian citizens are required to report any currency movements to or from a bank outside of the country to local tax agencies.

It further predates comments from deputy finance minister Alexei Moiseev, who in an interview last month said that the Russian Ministry of Finance is becoming supportive of the idea of amending proposed legislation to allow for the use of digital currency as a kind of foreign currency.

"We are formulating the law in such a way in order to allow buying cryptocurrencies for foreign operations and allow Russian citizens to sell bitcoins for profit reasons in foreign countries," he told state-owned newspaper Rossiyskaya Gazeta.

A copy of the letter can be found below:

RF Federal Tax Service Letter by CoinDesk on Scribd

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