New Delhi: In a big boost to cryptocurrency enthusiasts, Finance Minister Nirmala Sitharaman Tuesday introduced a 30 per cent tax on digital assets, essentially meaning the Narendra Modi government is moving towards legalising cryptocurrency as a legal asset.
The industry has welcomed the move.
Nischal Shetty, founder & CEO of WazirX India, told ABP News: “Clarity on income tax is a hugely positive step for the crypto industry. This also removes any fear people had about the impending ban. We now know that the Government is definitely inching towards regulations in this sector.”
Dr Arun Singh, global chief economist, Dun and Bradstreet, believes that the taxation of Virtual Digital Assets without setoff of loss with any other income is an indirect approval for cryptocurrencies.
BankBazaar.com CEO Adhil Shetty believes that the taxation of virtual assets is now clearly defined. “So we now at least know what tax filers can expect this year. Individuals might have wanted lower LTCG taxes and carry forward losses similar to equity or housing. But this is at least a start.”
According to Keyur Patel, co-founder and chairman of GuardianLink and BeyondLife.Club, the Union Budget at this juncture is as varied as possible when it comes to its stance on crypto and NFTs.
“It seems there is clear indications from the external chatter, that implication of long term capital gains and short term capital gains deduction at source of sales is a possibility for crypto transactions. It is an asset class and should not be treated any differently than other assets, so it would be an obvious step to tax it upon gain with inflation-adjusted pricing. As far as NFTs go, they are digital assets like art, music, or any other form of collectible art, and GST may be a more applicable tax structure than long-term or short-term taxation. Yet, to be seen where this all goes, but it is clear, Taxation governance for both Crypto and NFTs is imminent next step for union bill,” he said.
Sitharaman also announced that India will have its own digital currency this year.
The Reserve Bank of India (RBI) is likely to launch the Central Bank Digital Currency (CBDC), using the blockchain technology, later this year.