Fact Check: Russia Did NOT Go Back To Using A Gold Standard In Early March 2022

Fact Check

  • by: Christiana Dillard
Fact Check: Russia Did NOT Go Back To Using A Gold Standard In Early March 2022 Tax Adjustment

Did Russia go back to using a currency that operates on a gold standard? No, that's not true: Although Russian Prime Minister Mikhail Mishustin announced the abolition of the value-added tax (VAT) on precious metals in March 2022, this change is unrelated to whether the Russian ruble, Russia's currency, is based on the value of gold.

The claim appeared in an article (archived here) on March 4, 2022, by News Punch titled "President Putin Returns the Gold Standard to Russia." The article opened:

President Putin has announced the return of the gold standard in Russia which could make the Ruble the single most stable currency on the planet.

Users on social media saw this title, description and thumbnail:

President Putin Returns Russia to the Gold Standard

President Putin has announced the return of the gold standard in Russia which could make the Ruble the single most stable currency on the planet.

In a meeting on March 2, 2022, Mishustin briefly mentioned that the Russian government supported the decision to abolish the VAT on the purchase of precious metals, such as gold, by individuals. The standard VAT rate in Russia is 20%. An English translation of Mishustin's announcement (archived here) published by the Russian government read:

The Government has supported the decision to abolish VAT on precious metals for individuals as of 1 March. The State Duma is planning to consider a relevant draft law on 4 March.

People buying gold from a bank will not have to pay 20% value-added tax, as they do under current laws. This investment may become a good alternative to buying hard currency.

A clip of the meeting showing Mishustin discussing the VAT change can be found here and a Google translation of the clip can be found here. Russian finance and news outlets have published more information about the VAT change (here and here).

Robert Kahn, director of global macro-geoeconomics at the Eurasia Group, told Lead Stories during a phone call on March 9, 2022, that abolishing the VAT on precious metals in Russia is separate from any kind of reintroduction of a gold standard. Rather, the change would make it easier for the Bank of Russia to generate currency.

Regardless of the original motivation behind the VAT change, such decisions are now heavily influenced by the internationally imposed sanctions against Russia over its invasion of Ukraine, he said. Other experts also expect that Russia will rely more heavily on its gold reserves as the conflict continues.

Russia previously used a gold standard in the late 19th through early 20th centuries.

NewsPunch (formerly YourNewsWire) has published several hoaxes and fake news articles that Lead Stories has written about in the past so anything they write or publish should be taken with a large grain of salt. Their Facebook page The People's Voice even lost its verification checkmark according to a report from Media Matters For America.

The Terms of Use of the site (archived here, still referencing YourNewsWire) also make it clear they don't stand behind the accuracy of their reporting:

NEWSPUNCH, LLC AND/OR ITS SUPPLIERS MAKE NO REPRESENTATIONS ABOUT THE SUITABILITY, RELIABILITY, AVAILABILITY, TIMELINESS, AND ACCURACY OF THE INFORMATION, SOFTWARE, PRODUCTS, SERVICES AND RELATED GRAPHICS CONTAINED ON THE SITE FOR ANY PURPOSE.

The site was profiled in The Hollywood Reporter where it was described as:

Your News Wire, a 3-year-old website of murky facts and slippery spin, is published by Sean Adl-Tabatabai and Sinclair Treadway -- a Bernie Sanders supporter in 2016 -- out of an apartment in L.A.'s historic El Royale.

RationalWiki described it as:

YourNewsWire (styled as YourNewsWire.com) is an Los Angeles-based clickbait fake news website known for disseminating conspiracy theories and misleading information, contrary to its claimed motto ('News. Truth. Unfiltered').

Lead Stories reported in 2018 that YourNewsWire had rebranded itself as NewsPunch by changing its domain name in an apparent effort to evade filtering/blocking.

Other Lead Stories fact checks related to the 2022 Russia-Ukraine conflict can be found here.

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  Christiana Dillard

Christiana Dillard is a former news writer for Temple University’s Lew Klein College of Media and Communication. She received her undergraduate degree in English Writing from the University of Pittsburgh. She has been a freelance writer for several organizations including the Pittsburgh Black Media Federation, Pitt Magazine, and The Heinz Endowments. When she’s not producing or studying media she’s binging it, watching YouTube videos or any interesting series she can find on streaming services.

Read more about or contact Christiana Dillard

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