India’s crypto asset tax regime is gradually being rolled out in the fiscal year commencing April 1
The government has tightened the standards for crypto by preventing losses on one digital asset from being offset against income from another version of a crypto holding company, the junior finance minister said Monday.
The government will not allow tax cuts on infrastructure costs incurred while mining crypto assets as it will not be treated as acquisition costs, Finance Minister Pankaj Chaudhary told lawmakers in parliament.
The minister’s clarification is a further setback for an industry that was slammed with a high tax rate in the budget unveiled last month. The RBI and the government are skeptical of the sector despite a surge in trading volumes, fearing that digital currencies could be used for money laundering, terrorist financing and price volatility.
“Treating gains and losses of each market pair separately will discourage cryptocurrency participation and slow down the industry’s growth. It is very unfortunate and we are urging the government to reconsider this,” said Nishcal Shetty, co-founder and CEO of WazirX, owned by Binance. †
The tax regime for crypto assets in India will be gradually rolled out in the fiscal year beginning April 1. The provisions on the 30% tax will come into effect at the beginning of the fiscal year, while those relating to the 1% TDS will come into effect on July 1. 2022.
