Clarity On Crypto Is Welcome, Says Industry

The government levied a tax of 30% on digital assets, which includes various forms of Crypto Currencies. The industry has welcomed the move.

"We are delighted by the announcements today. It gives relief to a lot of investors that the Government is recognizing the crypto asset ecosystem and has taken efforts to give clarity on its taxation. This legitimizes the crypto asset in the country and paves way for a formal umbrella of regulations going forward.

A standardized 30% tax treatment is welcome though we await the details on what is a taxable event and what is the threshold for 1% TDS deduction. We do hope that the Government will give exchanges and other businesses a certain time period to enable the tech behind TDS deduction and bookkeeping. Offsetting and carry forwarding losses have worked well in other countries but we are happy to see a consideration given to all such instances," says Vikram Subburaj, CEO, Giottus Crypto Exchange.

According to him, the issuance of a central bank digital currency (CBDC) by the RBI will enable an efficient transfer of digital rupee much like UPI, IMPS or NEFT. This can make transfers cheaper and enable 24x7 serviceability.

"Overall, we believe that the ecosystem along with its businesses and investors are primed for growth in the upcoming future. The Government, we believe, has already laid the foundation for a future thriving and sustaining industry," Subburaj says.

"We are happy with this announcement as it at least places Cryptocurrency as a tradable asset in India. The NFT market will on one hand see a positive impact as with a 1% TDS on transaction, buyers from India will get to hold more NFT's without any more doubts on regulations or fear of penalties being imposed on holding crypto / NFT's. On the other hand, we expected the Capital Gain tax to be around 10 % -12%, but 30% is way too much for a Digital Classified Asset," says Micky Irons, Chief Marketing Officer, DeSpace Protocol.