The global digital asset heatwave is causing many governments to watch and look for ways to control the digital asset markets, especially the cryptocurrency market.
The latest country to enact a tax rule is India, where the crypto market has grown by 641% in a year. The country is now set to introduce a 30% tax on cryptocurrencies.
Today (Feb. 1), India announced plans to begin imposing a tax on cryptocurrencies, or cryptocurrencies and digital assets, as the domestic market grows rapidly in line with the global trend.
Finance Minister Nirmala Sitharaman said in a budget speech today that all proceeds from the transfer of digital assets will be taxed at 30%. No deductions or allowances are allowed.
“Transactions in digital assets have increased exponentially. So far, the value and frequency of these transactions has reached the point where it is necessary to establish a specific taxation system,” the Finance Minister said.
Acquisition costs are not taken into account when calculating income from digital assets. Losses from the sale of digital assets cannot be deducted from other income. And in the case of gifts in the form of digital assets, the person receiving the gift is also liable for tax.
However, the Indian crypto ecosystem is quite diverse, and clarity is still needed on many factors. Clarity on taxation and the regulatory framework now exists. But the country is still waiting for a clear classification of cryptocurrencies.