Budget 2022: India to Levy a 30% Tax on Income from Crypto and Virtual Digital Assets
The cryptocurrency situation in India has seen a lot of ups and downs in recent times. While the government has been going back and forth with crypto regulationsthe netizens were confused about whether it is legal to invest in digital assets like Bitcoin, Dogecoin, Shiba Inu, and others or not. However, in the recent Budget 2022 session, India’s Finance Minister Nirmala Sitharaman announced that the government will now levy a 30% tax on income from cryptocurrencies and digital assets like NFTs.
India to Levy 30% Tax on Crypto, NFT Investments
While cryptocurrency experts and investors were expecting clarity on taxation on income from cryptocurrencies and digital assets, some of them believed that the country’s FM would not address the concern during the Budget 2022 speech. However, FM Nirmala Sitharaman did address the crypto situation and announced that the government will start levying a 30% tax on income from cryptocurrencies and virtual digital assets. The Minister further added that no set-off will be allowed in case of losses. Moreover, any gifts in virtual digital assets would also be taxed in the hands of the recipient.
Now, the taxation policy on income from cryptos and digital assets is a positive move in the sense that the Indian government has finally recognized cryptocurrency as a legitimate investment option in the country. However, some crypto experts are discouraging the steep 30% tax rate.
“Including a specific tax regime for virtual digital asset (such as crypto) while [it] provides clarity is not in line with what the industry was expecting. The 30% rate of tax and restriction to set-off losses is a very bold move in discouraging transactions in crypto,” Ritesh Kumar, a partner in IndusLaw law firm, said in a statement.
On the other hand, crypto exchange platforms are seeing this as a powerful move for crypto regulation in India. Siddharth Menon, the co-founder of WazirX, tweeted that “the clarity on crypto tax is such a positive move by our government.”
“This essentially removes doubt of illegal vs legal for those who are still wondering. Now waiting for Banks to support us,” Menon further added.
So, what do you think about India charging a 30% tax on income from cryptocurrencies and digital assets? Do you think it is a positive move for crypto investments in India? Let us know your thoughts in the comments below.