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by Sunil Fernandes
| Updated Tuesday February 1, 2022 2:58 PM [IST]
As widely expected, cryptocurrencies are now taxed and likely at a very high rate. Much of your cryptocurrency gains are now taxable. A direct tax of 30% is payable on cryptocurrencies like Bitcoin, Ethereum, etc.
“First, we must consider that cryptocurrencies are being added to taxable assets by the government, which indirectly gives crypto a legible footing in the market. Introducing a digital rupee using the blockchain is also an excellent move. The 30 percent tax on digital asset transfers is a bargain, but no deduction is projected onto the computers, while losses cannot be offset against other income. Also on view is TDS’ imposition of 1 percent on transfers. All in above all, a big step towards going digital, making currency an established form of payment and strengthening the technology based on it,” says Amit Gupta, MD, SAG Infotech.
According to Gaurav Kapoor, director and co-founder of Fincorpit Consulting Private Limited, “Bitcoin has become increasingly popular in India in recent years. India has one of the largest digital token markets with over 10 million cryptocurrency investors. Providing a tax framework for virtual currency investments has long been a wish of investors. Nirmala Sitharaman, the Minister of Finance, proposed a new tax structure for cryptocurrency investors,” he says.
The transfer of assets in virtual or cryptocurrency will be taxed at 30% according to the 2022 Union budget.
In the 2022 Budget, the Treasury Secretary stated that no deductions other than acquisition costs would be allowed and no transaction losses would be carried forward on cryptocurrencies.
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