Crypto Tax Policy Brings 30% Tax On Cryptocurrency Transactions, No Respite On Losses

Finally, India’s crypto tax policy has come into force! The government has chosen a cautious stance regarding crypto assets by establishing an introductory 30% tax rate on all revenue produced from these assets. Nirmala Sitharaman, In her Budget Speech 2022, India’s Finance Minister announced a 30% tax on income derived from the transfer of virtual digital assets. She stressed that there would be no set-offs in the event of any losses. Virtual digital assets may be taxed depending on how the receiver manages them.

According to experienced professionals and insiders, the crypto community has welcomed the 30% crypto tax policy rate on digital asset revenue. Another thing to note is that the values of the most significant cryptocurrencies listed on Indian exchanges—such as bitcoin and ethereum—were not adversely affected—they went up—instead, they went down.

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Sithraman pointed out that “virtual digital assets” transactions have grown at an unprecedented rate, making it essential to provide a tax structure geared explicitly to these transactions.

Nirmala Sitharaman On Crypto Tax Policy

According to the country’s finance minister, there would be a 30% crypto tax policy on all digital asset revenue, who recommended that all virtual currencies be taxed as digital assets. Apart from charges made in acquiring such products, Sitharaman emphasized that no deduction should be granted to spending or concessions when determining this income. There is no alternative way to offset the loss of a digital virtual asset from a different source of revenue.

As a result, the Finance Minister recommended that virtual digital assets be subject to TDS at a rate of one percent for payments beyond specific thresholds. The idea has been floated that the person who receives a virtual digital asset as a gift should pay taxes on it. Nirmala Sithraman also signaled the introduction of Digital Rupee, which the central bank will back up.

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A partner at DVS Advisors LLP, Sundara Rajan TK, had some thoughts on the development. For a long time, it was thought that clarification on the taxing of digital assets would be supplied this year, but it has not. With a 30% crypto tax policy levied on digital assets, as well as a launch of its very own virtual money, it is an indication that the government is trying to discourage people from investing in crypto, intending that only wealthy people will do so and that the government will not allow cryptos to be used as a currency “There is a lot of demand for this.”

Budget 2022 was expected to clarify either implementation of crypto tax policy or regulation policy for crypto assets. Experts think that Nirmala Sitharaman would not openly address the cryptocurrency problem in her Budget Speech 2022, as some had expected. In any event, we can anticipate the Minister of Finance to make some crypto tax statements within the following week.

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For Sanjeev Sanyal, who serves as the Government’s Principal Assistant Secretary, cryptocurrencies must be approached with caution. Currently, neither cryptocurrency nor blockchain was included in the Economic Survey 2022, laid before Parliament on Monday. 2021. Another reason why a bill regulating cryptocurrency is unlikely to be introduced in Parliament during the current budget session.

In reality, the Ministry of Finance and even Parliament have discussed this issue for quite some time. In other words, this is what we’re talking about right now: we need to address the specific problems related to financial security. Arguments in support of the innovation and the like are also made. An objective assessment of the subject would be provided, “According to PTI, Sanyal said this.

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Deep Gautam

Deep Gautam is an Editor at Tech Heralds.

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