Cryptocurrency Tax in India for Certain Transactions Likely To Be Exempted

• Gifts of crypto will be taxed in the same way as any other asset.
• Cryptocurrency transactions are taxed at 30 percent under the Finance Act, 2022.

The Indian government’s Ministry of Finance will likely announce the crypto tax in June. Hospitals that employ Blockchain technology and also earned points on digital bank cards or flight miles may be exempted from this rule. Cryptocurrency transactions are taxed at 30 percent under the Finance Act, 2022, and 1 percent TDS was added to transfers of digital assets.

The TDS which is currently set at $643 USD, must be paid regardless of whether profits or losses are realized through crypto transactions. This information must be included on the taxpayer’s yearly tax return. According to the rules, gifts of crypto will be taxed in the same way as any other asset.

Uncertainties Over Regulatory Framework

In this year’s annual budget, the government said that it would impose a 30 percent tax on earnings from cryptocurrency investments. Still, the nation has not yet granted legal validity to the policy.

The government will release a consultation document on digital currency in the near future. There may be a delay in putting the legal and regulatory framework in place. According to Economic Affairs Secretary Ajay Seth, financial institutions, including the World Bank and the International Monetary Fund, have been consulted. The consultation document is nearly finished, the bureaucrat said. Seth has been mum about the timing, but the sources say it may be brought to the floor in August of this year.

An Indian rupee-denominated index tracking the performance of the eight most valuable cryptocurrencies by market capitalization has also been launched by CoinSwitch Kuber, one of India’s most famous crypto exchanges.