India’s high crypto tax may force the industry to go offshore or underground, experts fear

February 18, 2022

By Priyanka Shetty

Crypto enthusiasts in India have been waiting for a long time to get clarity on crypto and finally when the taxation of 30% on crypto was announced, there was hope after all for regulation. However, later it was specifically told that crypto is still not a legal tender. Analysts believe that high tax may force the industry to leave the country or go underground.

Here is what you need to know:

  • While levying tax rules is a positive step, however, investors aren’t happy with the number. According to reports, analysts see the 1% TDS (tax-deductible at source) applicable to every single transaction involving crypto is a problem.
  • Kunal Jagdale, Founder, BitsAir Exchange believes that the high tax rate could have a serious implication on the industry.  The recipient is now liable to pay 30% of his return as tax, irrespective of his level of income. He said: “Although cryptocurrencies are described as assets in the budget, they are being handled differently than other assets.”
  • He further added: “People also feel that higher taxes will force the industry to leave the country. Some even think that too high a tax may prompt the industry to operate underground as well as move upcoming innovations overseas.”
  • While India is taking the rigid road on taxation, the United Arab Emirates and Thailand have reduced their tax rates to become more crypto-friendly.

 


About the author

Based in Bengaluru, Priyanka Shetty is a freelance writer for Blockchain Asset Review.

Share
Leave a Reply

Your email address will not be published. Required fields are marked *