Wednesday, October 5, 2022

30% Tax Proposed on Digital Assets as India Embraces Regulation

India has put forward its intent to legalize crypto and digital assets in its economy from the next fiscal year which commences in April. This was announced on Tuesday after so many years of wavering stance on the subject of cryptocurrency.

As clear signs of crypto acceptance in India, a 30% tax has been suggested to be imposed on all digital assets earnings. Gifted digital assets are not left out of the taxation as recipients of cryptocurrencies will be subjected to the same rule.

During the India Budget Speech, Finance Minister, Nirmala Sitharaman noted that the popularity and recognition gained by cryptocurrency and other non-fungible tokens (NFT) have necessitated this regimentation standard.

Nirmala said this hike in the frequency of digital assets transactions in India’s economy is one of the underlying factors backing the push for the adoption of the nation’s digital Rupee.

The South Asian country has captured the high volume of crypto users on different digital platforms and can now identify with the high turnover that would be gained if crypto is finally legalized. For example, WazirX CEO Nischal Shetty pointed out the huge number of transactions on its platform as of December hitting almost $43 billion, which he said was equivalent to about 1735% growth from 2020’s transaction volume.

In light of all this, the Central Bank of India has set the ball rolling to ensure the circulation of its central bank digital currency (CBDC) in the near future.

Humble Beginnings for Crypto Assets in India

Silicon Valley’s Andreessen Horowitz was one of those who made its maiden digital venture in India. He extensively supported the work of CoinSwitch Kuber last year. 

In this venture, $260 million was raised as funding and this was recorded to be one of the largest in India at that time. a16z set the tone with $80 million while Coinbase Venture invested $150 million.

This investment in CoinSwitch Kuber catapulted the platform’s value virtually four times its valuation of $500 million six months ago. The $1.9 billion upgrades led to Kuber being regarded as an Indian unicorn and have attracted huge funding to the provincial startup.

India has definitely witnessed a great surge in its crypto economy following these investments. The move by the Finance Ministry to tax crypto assets will also mark a humble beginning for the country which is fast growing to become a global digital currency innovation hub

Victoria Nye
A Blockchain columnist who is enthusiastic about developing a network interface between the real world and the cryptosphere.

Related Articles

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Stay Connected

0FansLike
0FollowersFollow
2,043FollowersFollow

Latest Articles

%d bloggers like this: