The cryptocurrency industry and traders in India are still facing regulatory uncertainty from the government. Last year, the Reserve Bank of India issued strong reservations on the matter of crypto payments and crypto trading liberty. On the other hand, Nirmala Sitharaman, finance minister of India under the Modi administration, kept changing the narrative on the matter.
Starting by hinting at a clampdown on the crypto market, Sitharaman later added that the government plans to work alongside the cryptocurrency traders in the region and regulate the market. This year FM office imposed a 30% tax in lieu of Capital Gains in addition to 1% tax cuts per transaction. However, it seems that the government is working on introducing more taxes on crypto investors.
India Imposed Heavy Taxes on Crypto Investors
The government of India managed to come to terms with the idea of cryptocurrency trading and recognized it as a legitimate asset class. On the other hand, cryptocurrency traders and organizations are struggling to survive under the increasing pressure of taxation. The latest tweet from CNBC news postulates that cryptocurrency investors in India are about to deal with another heavy tax.
Quoting Ajeet Khurana from Reflexical, CNBC news posted that GST Council is planning to impose a 30% tax in lieu of Goods and Services Tax. Meanwhile, some media sources are speculating the probability of an additional 20% tax imposition on DeFi sector tokens per transaction. As per the CNBC-TV18 branch, GST Council has not finalized its decision yet, and the date for the next meeting to address the matter will be announced soon.
The cryptocurrency investors hailing from India make a very large portion of cryptocurrency traders in the world. The outage of Indian cryptocurrency investors can generate a devastating impact on the market transaction volumes. However, the exiting of the cryptocurrency exchanges and other organizations has already started.
The aggregate taxes on crypto investors add up to 50% of the revenue. Under these circumstances, more cryptocurrency exchanges have folded their businesses and relocated to locations like Dubai. Amid the havoc, the Indian depository NSDL has recently announced that it is planning to adopt a bond issuance technique for its future bond publications. Meanwhile, RBI aims to introduce a CBDC before the end of the year.