When it comes to the adoption of cryptocurrencies in third world countries, India is ranked on top of the rest. In recent years it has become quite clear that the people in India are eager to get their hands on cryptocurrencies.
Although the Indian Government does not support cryptocurrencies, still the industry has been flourishing in the country. The cryptocurrencies and digital assets currently do not have legal status in the country. Even the Indian Government on many occasions has proposed the idea of banning cryptocurrencies in the country.
However, a final decision is yet to be made whether cryptocurrencies will gain legal status in the country or not. On the other hand, the cryptocurrency community in the country is growing fast. At present, there are more than 5 million active users that are involved in cryptocurrency activities. This number makes up 5% of the total cryptocurrency community from around the world.
As of now, there is a total of 504 cryptocurrency exchanges in the entire world and 10 of those exchanges belong to India. However, the Indian Government paid no interest in the cryptocurrency industry initially, now it seems that it is somewhat interesting.
The main reason is that the industry has gained significance in the country’s economy. Therefore, the Indian Government now plans on bringing the cryptocurrency under its regulatory radar.
Just recently, the Finance Ministry has proposed to introduce taxation laws on the usage of Bitcoin (BTC) in the country. The proposal of the Bitcoin (BTC) has been proposed by the Central Economic Intelligence Bureau (CEIB) of the Indian Finance Ministry.
In the proposal, the Central Economic Intelligence Bureau (CEIB) has proposed to levy a tax rate of 18% on Bitcoin trading under the goods and services taxation law.
In the proposal, the CEIB has claimed that the current transaction volume generated by Bitcoin (BTC) in the country is more than $5.4 billion. Thus, imposing an 18% tax on the Bitcoin (BTC) transactions would be able to generate a lot of funds for the Indian Treasury. It has been estimated that from the taxation, the Indian Government would be able to generate around $970 million worth of revenue.
The CEIB has also proposed to make cryptocurrencies part of the intangible assets. If this is done, then it would mean that the cryptocurrencies would be liable and levied to pay taxes for all the trades that are done through its platform.
Following the proposal made by the CEIB, TanviRatna jumped onto the situation and shared her concern through Twitter. She stated that even though the CEIB is proposing to put taxes on cryptocurrencies, still it does not mean that the Indian Government will accept crypto as a legal entity.
She stated that the worst part is that even the illegal income is taxable in India and evading it is considered a criminal act.