Cryptocurrency Tax in Union Budget 2022
Union Budget 2022 is live and the Indian crypto tax regime is finally here. In union budget 2022 the Indian government has taken a conservative stand on cryptocurrency taxation. In this budget govt. has decided a 30% tax on income from cryptocurrencies.
The budget is presented by Finance Minister Nirmala Sitharaman, in her budget she said the 30% tax would be charged on income from virtual digital assets. She explained no set-off will be allowed in case of any losses. She also said the gifts in the form of virtual digital assets would be taxed in the hands of the recipient.
Nirmala Sitharaman said the phenomenal increase in transactions in virtual digital assets has made it imperative to provide for a specific tax regime.
She said, “Accordingly, for the taxation of virtual digital assets, I propose to provide that any income from transfer of any virtual digital asset shall be taxed at the rate of 30 percent”. She also said no deduction in respect of any expenditure or allowance shall be allowed during computing such income except the cost of acquisition. And the loss from the transfer of virtual assets can’t be set off against any other income.
Finance Minister also said the TDS will be deducted on payment made in relation to the transfer of virtual digital assets at the rate of 1% of such consideration above a monetary threshold.
A Blockchain-based and RBI-backed Central Bank Digital Currency (CBDC) will be introduced soon, said Finance Minister in her budget.
Overall this is positive news for cryptocurrency investors and users. Now it is more clear that the govt. is not going to ban virtual digital assets (i.e. cryptocurrencies).
I am Pawan Kashyap currently living in Amritsar. I always try to grab new things from the cryptocurrency market. From my observations and trends in the market, I always try to provide the best and accurate information in the form of articles from this blog. Follow us on Facebook, Instagram, and Twitter to join us.