Cryptocurrency investors and exchanges feel that the government’s decision to 30% Tax on Digital Assets has provided clarity and is the first step toward the asset class’s ultimate legitimization.
It’s likely the first time an industry applauds the implementation of a high tax on the asset class in which it trades.
Investors and companies in the virtual digital asset and cryptocurrency ecosystem applauded Finance Minister Nirmala Sitharaman‘s decision to tax
“any revenue from the transfer of any virtual digital asset”
at 30%, describing it as a step toward “mainstreaming excitement” about the asset class.
Statement by CEO of CoinSwitch about 30% Tax on Digital Assets: Â
“The government’s tax regulation advice adds to the mainstreaming enthusiasm of this burgeoning asset class, which now has over $6 billion in investments in India.”
“The budget clarifies taxation and demonstrates the government’s intention to take a business-friendly approach while safeguarding the interests of consumers and the exchequer,”
said Ashish Singhal, the founder and CEO of CoinSwitch.
It’s also the portal to Web3.0, the future decentralized world. Singhal is also the co-chair of the Blockchain and Crypto Assets Council, a trade group for cryptocurrency firms founded under the umbrella of the Internet and Mobile Association of India.
Nirmala Sitharaman’s statement about 30% Tax imposes:
Despite Sitharaman’s statement that the move to tax should not be viewed as a step toward legitimizing the asset class, the industry remains upbeat.
In a post-budget interview, the Finance Minister stated that she could not regulate or formalize a regulatory framework for cryptocurrencies and other virtual digital assets.
The government has failed to introduce The Cryptocurrency and Regulation of Official Digital Currency Bill, despite the Finance Minister’s caution on the subject.
It sought to
“establish a facilitative framework for the formation of the official digital currency to be issued by the RBI.”
and was scheduled for introduction during the previous winter session of Parliament. It aimed to “prohibit any private cryptocurrencies,” with “limited exceptions to encourage the underlying technology.”
Despite this, cryptocurrency coin exchanges and other experts believe the taxation action is
“a welcome step because it legitimizes crypto and indicates an optimistic mindset toward wider acceptance of crypto and non-fungible tokens (NFTs) across stakeholders in the country.”
“While gains on virtual digital currencies have always been subject to taxation, the ecosystem lacked clarity.”
The decision to tax virtual digital assets provides clarity on the road forward for the whole ecosystem, including investors and exchanges.
From last February to today, the government has changed its view on cryptocurrencies, and we are confident that this will usher in a new era of prosperity and creativity for India,”
said Avinash Shekhar, CEO of ZebPay, a cryptocurrency exchange.
The sector also applauded the government’s decision to create its digital rupee, which is expected to be launched by the RBI, in the hopes of familiarising both investors and non-investors with virtual currency and “creating an appetite” for the asset class.
Edited By- Kritika Kashyap
Published By- Satheesh Kumar
