Will TDS be applicable on cryptocurrencies? may be announced in the budget
The government may consider levying TDS/TCS on the sale and purchase of cryptocurrencies above a certain limit in the upcoming budget. According to experts, income from the sale of cryptocurrencies should also be taxed. Just as the government charges more tax on lotteries, game shows and puzzles etc., the same tax can be charged on cryptocurrency. The government can impose a tax of up to 30 percent on the earnings from the sale of cryptocurrencies.
Budget will come on February 1
Nangia Andersen LLP Tax Leader Arvind Srivastava while talking to PTI about the Budget 2022-23 to be presented by the government on February 1 said that India could have a store for the crypto industry. It is estimated that investment by Indians in cryptocurrencies is expected to increase to $241 million by 2030. According to a report, India currently has the largest number of crypto investors globally at 100.7 million.
Expected to be crypto regulated ——
He said a bill was expected to be introduced during the “winter session” of Parliament to regulate cryptocurrencies. However, it was not introduced and now it is expected that the government may introduce this bill in the budget session. He added, “We expect the government to introduce a regressive tax regime for cryptocurrencies.
TDS or TCS rule applicable——
He added that considering the risks involved with cryptocurrencies, there may be some changes in the size of the market and the amount involved such that they will be brought under the provision of Tax Deduction at Source (TDS) and TCS. With this, the government will get complete information about the investors along with earning. Along with this, information about how much cryptocurrency business is going on in the system will also continue to be available. Also both the sale and purchase of cryptocurrencies should be brought under reporting in the Financial Transaction Statement (SFT).
What is the condition of crypto in the country?——
Currently, there is no regulation or any restriction on the use of cryptocurrencies in the country. The ‘Cryptocurrency and Regulation of Official Digital Currency Bill’ is now expected to be introduced in the budget session of Parliament beginning January 31. The government is making changes to the income tax laws to bring cryptocurrencies under the tax net.