There were two distinctive phases. Before early mid-1930s, celebrating Christmas was strongly discouraged, but then, it has been replaced by the New Year's Day that has taken most of the Christmas trappings (a family dinner, exchanging gifts, setting up the New Year's Tree...). The fact that in Russia the New Year comes before Christmas (because of the different calendar used by the church) certainly helped, and even today, we are much more into the New Year rather than Christmas.

So (except some predominantly Catholic and Protestant areas, probably, such as the present-day Baltic States and Western Byelarus and Ukraine) you had to be very religious to celebrate Christmas rather than the New Year. It was sort of ok for the elderly folks, but not something a member of the Party, or of the Komsomol (the Communist Party's youth branch) could have done without repercussions. Again, by the late Soviet era, there was nothing criminal in it, but in really bad circumstances it could have ruined one's career - or make impossible a voyage abroad, especially if one has attended the Christmas or any other service performed by a suspect priest.

As for providing for gifts, there was never such a thing as you suppose. People were either buying them or sometimes crafting them as anywhere else, except that they had much less choice if they had to buy them, but that's another story.