Tax and track: How Budget is mixed bag for crypto investors

economictimes.indiatimes.com:

India became one of the few countries to tax digital assets like cryptocurrencies and NFTs (non-fungible tokens) when finance minister Nirmala Sitharaman announced a 30% tax on transfer of such assets in the Budget. Though the FM said taxing an asset does not bring legitimacy, industry watchers said that clarity on tax policy is likely to be the first step towards regulation of crypto. Some industry players said that the high tax will dissuade investors, while others felt it will give confidence to serious investors. The Budget announcements mean that income from any transfer of crypto, even gifts, would attract a 30% tax. In addition, investors cannot get any deductions and won’t be allowed to set off losses from transfer of such assets against any other income. The government has sent a strong signal against speculation or trading by retail investors, according to analysts.Attract or dissuade investors?According to industry players, clarity on taxation will give new customers confidence to enter the crypto market. Darshan Bathija, CEO & co-founder of crypto exchange Vauld, said that the government’s move has addressed concerns around legality and that he expects more Indians to invest in crypto.

Did you Know?

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However, Sathvik Vishwanath, CEO and co-founder of crypto bourse Unocoin, said, “The tax rate of 30% is the highest among all asset classes and that could dissuade some old investors. But some investors who wanted to get into crypto once