What Is Future of Cryptocurrency In India 2022? is now being the most trending question after the announcement of Budget 2022-23. The move to tax digital assets will be a huge setback for existing crypto investors in the coming fiscal year, and it may deter new crypto investments. The establishment of a crypto tax system in Budget 2022-23, which would impose a flat 30% tax on income from crypto and digital assets, foreshadows the potential future of cryptocurrencies as a financial asset in domestic markets.
New Taxes on Cryptocurrency in India 2022
The profits earned from trading or investing in cryptocurrencies or other digital assets such as NFTs will be subject to a 30% tax. What Is Future of Cryptocurrency In India 2022? Any losses experienced as a result of the transfer of a virtual digital asset, according to the notification, cannot be credited against any other revenue. The government has also suggested levying TDS on payments made in connection with the transfer of virtual digital assets at a rate of 1% of the amount paid over a certain monetary threshold. In addition, it is recommended that every gift of a virtual digital asset be taxed in the hands of the recipient.
Proposal of tax for Digital Assets in new Bill
As per the budget memorandum virtual digital assets have gained tremendous popularity in recent times and the volumes of trading in such digital assets has increased substantially. In fact, a market is developing in which payment for the transfer of a virtual digital asset may be paid using another virtual digital asset. As a result, the Bill proposes a new method to tax these virtual digital assets.
What Is Future of Cryptocurrency In India 2022: Impact of Tax on Cryptocurrency
What Is Future of Cryptocurrency In India 2022 beholds: The move to tax digital assets will be a huge setback for existing crypto investors in the coming fiscal year, and it may deter new crypto investments.
India has 15 million to 20 million cryptocurrency investors, according to industry estimates, with a total crypto market valuation of over Rs 40,000 crore. A cryptocurrency is a digital or virtual currency represented by tokens or coins. The acronym “crypto” refers to the complicated encryption that allows for the generation and processing of digital money as well as transactions across decentralised networks.
Although sources in the Finance Ministry and industry experts have stated that cryptocurrencies would be considered as a digital asset in the future, the government has yet to specify whether and how it will accept them. The government is now drafting regulations to oversee the usage of cryptocurrencies in the country. Sanjeev Sanyal, the government’s principal economic adviser, has stated that the government must adopt a balanced and comprehensive approach to cryptocurrencies.
What does this signify for cryptocurrency investors? and also What Is Future of Cryptocurrency In India 2022?
This means that if you own cryptocurrencies, your earnings will be taxed at a rate of 30%. Any earnings made from cryptocurrency trading, including gifts and transfers of virtual assets from one wallet to another controlled by separate people, would be taxed at 30%.
Cryptocurrency traders now have to record gains and losses that cannot be adjusted against other sources of income. According to Abhinav Soomaney, Forensic and Crypto Expert as well as CEO of Cryptotax, the government has established a fixed 30% rate to ensure that all investors pay a part of their income to the government in the form of taxes.
What cryptocurrency investors can do?
What Is Future of Cryptocurrency In India 2022?
Many investors giving their views through social media, youtube channel, etc. The business of cryptocurrency is very volatile, it is not known when the market becomes very down and when it goes too high, so the government should analyze it before regulating it.The 30% tax on the income generated from crypto currency is very high, the government should levy only 5% tax on it, and every cryptocurrency consumer should show the annual statement in the ITR.