India Crypto Taxation News: With India's Finance Minister Nirmala Sitharaman set to finalize the 2023-24 budget, the crypto community is...

Lower Cryptocurrency Tax in Union of India's 2023 Budget? : what to expect



India Crypto Taxation News: With India's Finance Minister Nirmala Sitharaman set to finalize the 2023-24 budget, the crypto community is hoping for some relief from a tough crypto tax stance. The 2023 Union Budget will be presented to the country's parliament on 1 February 2023. While the cryptocurrency market has yet to gain regulatory clarity globally, the industry continues to expand in scope. Although it faced huge hurdles with the Terra Network debacle and the recent FTX bankruptcy.


While several countries around the world have yet to take a clear stance on cryptocurrency regulation, countries like Singapore and India are taking a selective approach. As the start of a huge project, the country's central bank recently launched a digital rupee (e?) for wholesale operations in the country in select cities. It is also seen as part of the RBI's ongoing efforts to launch its own central bank digital currency (CBDC).


Crypto tax cut in budget announcement?


Meanwhile, the crypto community is hoping that the upcoming budget meeting will bring about some restoration of crypto taxation. High taxes on virtual digital assets have plagued the industry's outlook in the country due to the lack of clarity on cryptocurrency trading and its regulatory framework. Authorities in the country have yet to provide clear guidance on how cryptocurrency companies should register and operate within their jurisdiction. This is all the more important given the heightened risk of corporate exodus from India.


Currently, India imposes a 30% tax on all profits made through cryptocurrencies. Traders cannot offset losses from trading one cryptocurrency with profits from another cryptocurrency. Additionally, traders are subject to a 1% source tax deduction for cryptocurrency transfers.