eaLiTy (OP)
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February 01, 2022, 07:02:48 AM Last edit: February 01, 2022, 07:20:32 AM by eaLiTy |
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As the budget session is going on, India Announces Tax On Income From Digital Assets at 30% and there is no deductions allowed and from what i understand during the session, even if you encounter a loss trading cryptocurrencies there is no deduction in taxes ![Roll Eyes](https://bitcointalk.org/Smileys/default/rolleyes.gif) . Since the session is going on live, the details will be known at a later time, but still i think this is the way moving forward and the hefty tax will force anyone dealing in huge numbers to look for safe heavens. I know there are some experts in here in the finance sector, so i would like to hear your opinion regarding this and what are their plans moving forward. Another initiative that is announced is that RBI will be launching its own digital currency ![Undecided](https://bitcointalk.org/Smileys/default/undecided.gif) .
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pakhitheboss
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February 01, 2022, 07:33:07 AM |
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As the budget session is going on, India Announces Tax On Income From Digital Assets at 30% and there is no deductions allowed and from what i understand during the session, even if you encounter a loss trading cryptocurrencies there is no deduction in taxes ![Roll Eyes](https://bitcointalk.org/Smileys/default/rolleyes.gif) . I am not a finance guys but this is what I deduce from what the FM announced. 30 percent flat to be taxed for digital assets transfer. Transfer does not mean trading here but I think crypto to fiat transaction will fall under this category. Regardless of the profit or loss you make while you trade, recieve gift or the work pay you recieve you will pay that percent. It is too early to come into any conclusion now. We have to wait for more details. If that is the case then many will go back to private P2P payment.
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libert19
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February 01, 2022, 08:22:07 AM |
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https://mobile.twitter.com/ThatNaimish - for unbiased and honest info. Let the noise settle, answers will come.
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pawanjain
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February 01, 2022, 04:04:53 PM Last edit: February 01, 2022, 04:18:27 PM by pawanjain |
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Well, we will have to wait until the proposed bill will be taken into action. There are too many clauses which are still undefined. We will get to know clear information only when the taxation is started and people start paying taxes on crypto incomes.
One thing that I am astonished to see is that people are actually worried about the 30% tax applicable on crypto income. But they are not acknowledging the fact that this paves the way for India to legalize crypto trading in India. This might be the huge break that we needed from all the negative news about crypto in India. May be we can win the battle of reducing the taxation towards crypto income some time later.
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pgbit
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February 01, 2022, 05:52:18 PM |
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Bekar hai crypto ab....10% 20% profit me log khus hote they or ab yha 30% tax dena hoga loss ho to profit .buy sell ka alag se charge platform + goverment ko 1% har buy sell me.. wah mere desh ki Kia kehne.
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avikz
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February 01, 2022, 06:28:28 PM |
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I am not worried about 30% taxation. Rather I am happy that India government is finally recognizing cryptocurrencies despite the huge pressure from Banking lobby.
Also, please understand the calculation of 30% taxation,
You invested on 1 Jan 2022: 1000 INR You sold on 30 March 2022 at: 5000 INR Your profit: 4000 INR Tax liability: 1200 INR
Now Indian crypto exchanges will have to bring in systems that can recognize this pattern and generate a capital gain statement for each investors.
However, it is a proposal and now it will be formulated and made a law through government notification. As far as I know, this is not going to take effect from this FY.
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libert19
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February 02, 2022, 04:57:43 AM |
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One thing that I am astonished to see is that people are actually worried about the 30% tax applicable on crypto income. But they are not acknowledging the fact that this paves the way for India to legalize crypto trading in India. This might be the huge break that we needed from all the negative news about crypto in India. May be we can win the battle of reducing the taxation towards crypto income some time later.
Exactly, although I consider 30% to be quite huge but still it's step in right direction. Bekar hai crypto ab....10% 20% profit me log khus hote they or ab yha 30% tax dena hoga loss ho to profit .buy sell ka alag se charge platform + goverment ko 1% har buy sell me.. wah mere desh ki Kia kehne.
I think you can claim tds, it's more of implemented to keep track of each transaction.
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JSRAW
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February 02, 2022, 06:00:46 AM |
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I am not worried about 30% taxation. Rather I am happy that India government is finally recognizing cryptocurrencies despite the huge pressure from Banking lobby.
Also, please understand the calculation of 30% taxation,
You invested on 1 Jan 2022: 1000 INR You sold on 30 March 2022 at: 5000 INR Your profit: 4000 INR Tax liability: 1200 INR
Now Indian crypto exchanges will have to bring in systems that can recognize this pattern and generate a capital gain statement for each investors.
However, it is a proposal and now it will be formulated and made a law through government notification. As far as I know, this is not going to take effect from this FY.
I would have liked more if taxation was according to existing tax slab with some sort of tax benefit if one is holding for long period of time, like 2-3 years but nevertheless its a good start and excellent news for crypto in India, hope they revise the tax as time progress. I think you can claim tds, it's more of implemented to keep track of each transaction.
Totally Baniya move if i'm being honest lol . Baniya move in good way tho considering every exchange will do heavy lifting and make thing easy for authorities.
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pawanjain
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February 02, 2022, 03:57:44 PM |
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I am not worried about 30% taxation. Rather I am happy that India government is finally recognizing cryptocurrencies despite the huge pressure from Banking lobby.
Also, please understand the calculation of 30% taxation,
You invested on 1 Jan 2022: 1000 INR You sold on 30 March 2022 at: 5000 INR Your profit: 4000 INR Tax liability: 1200 INR
Now Indian crypto exchanges will have to bring in systems that can recognize this pattern and generate a capital gain statement for each investors.
However, it is a proposal and now it will be formulated and made a law through government notification. As far as I know, this is not going to take effect from this FY.
I would have liked more if taxation was according to existing tax slab with some sort of tax benefit if one is holding for long period of time, like 2-3 years but nevertheless its a good start and excellent news for crypto in India, hope they revise the tax as time progress. You are right. Taxing crypto with the current slab would have been really great but for now celebrating the legalization of crypto trading should be the primary thing. At some point they will have to reduce the taxation because it's totally unfair that they are taxing 30% for crypto gains while 15% - 20% on stock gains. Another thing is how would the government determine how much we should pay on the amount that we are already holding in our wallets ? What about those people who are doing jobs to earn crypto and services that are using crypto ? There's just too many uncertainties.
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JSRAW
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February 02, 2022, 07:03:37 PM |
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At some point they will have to reduce the taxation because it's totally unfair that they are taxing 30% for crypto gains while 15% - 20% on stock gains.
I think they are considering crypto as similar to gambling, not stock trading but betting kind. Another thing is how would the government determine how much we should pay on the amount that we are already holding in our wallets ? I like to believe that gov will never know if some one holding millions of dollars worth of btc in paper wallet as long as he-she is not cashing out but again if there is transaction then there is record. What about those people who are doing jobs to earn crypto and services that are using crypto ? There's just too many uncertainties. Unfortunately, if they are earning less yearly then they are fucked for sure.
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pawanjain
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February 03, 2022, 09:07:58 AM |
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At some point they will have to reduce the taxation because it's totally unfair that they are taxing 30% for crypto gains while 15% - 20% on stock gains.
I think they are considering crypto as similar to gambling, not stock trading but betting kind. In that case they should follow state specific gambling laws since the government has told the states to imply their on rules for gambling. What about those people who are doing jobs to earn crypto and services that are using crypto ? There's just too many uncertainties. Unfortunately, if they are earning less yearly then they are fucked for sure. Ofcourse they are, just imagine giving out 30% of your income to the government as a tax. That is definitely a major chunk of your income for which you have worked hard. I think the government has made a blind decision and should provide more clarity on how things will be considered.
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| | . .Duelbits. | │ | ..........UNLEASH.......... THE ULTIMATE GAMING EXPERIENCE | │ | DUELBITS FANTASY SPORTS | ████▄▄▄█████▄▄▄ ░▄████████████████▄ ▐██████████████████▄ ████████████████████ ████████████████████▌ █████████████████████ ████████████████▀▀▀ ███████████████▌ ███████████████▌ ████████████████ ████████████████ ████████████████ ████▀▀███████▀▀ | . ▬▬ VS ▬▬ | ████▄▄▄█████▄▄▄ ░▄████████████████▄ ▐██████████████████▄ ████████████████████ ████████████████████▌ █████████████████████ ███████████████████ ███████████████▌ ███████████████▌ ████████████████ ████████████████ ████████████████ ████▀▀███████▀▀ | /// PLAY FOR FREE /// WIN FOR REAL | │ | ..PLAY NOW.. | |
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teosanru
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February 03, 2022, 06:16:09 PM |
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As mentioned, it's definitely a great blunder, not only because the government has taxed cryptocurrency at 30%, they are also not allowing to set off your losses in cryptocurrency, as mentioned by JSRAW, they have considered crypto income more like casual incomes made from Gambling, betting, lottery. This means it's clear they are not giving it the status of an organized market. Moreover this decision has ensured that there won't be any crypto startups in this country moving forward. At some point they will have to reduce the taxation because it's totally unfair that they are taxing 30% for crypto gains while 15% - 20% on stock gains.
I think they are considering crypto as similar to gambling, not stock trading but betting kind. In that case they should follow state specific gambling laws since the government has told the states to imply their on rules for gambling. State-specific laws are merely for organizing gambling, taxation is handled centrally only, they are treating the incomes from crypto as gambling, not treating the crypto trading as gambling altogether.
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arbifahrozy
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February 03, 2022, 07:15:40 PM |
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Feel free to buy tax slabs starts from 2023-24. Reason is bill passing won't happen until October 2022. So this winter session their adopt guidelines and finally implement from April 2023-24. So don't be upset or withdraw all ur crypto. U knw almost 80% politicians are in crypto. Nothing to wry.
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libert19
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February 04, 2022, 03:10:48 AM |
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.. U knw almost 80% politicians are in crypto. Nothing to wry.
What's source of this?
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| | . .Duelbits. | │ | ..........UNLEASH.......... THE ULTIMATE GAMING EXPERIENCE | │ | DUELBITS FANTASY SPORTS | ████▄▄▄█████▄▄▄ ░▄████████████████▄ ▐██████████████████▄ ████████████████████ ████████████████████▌ █████████████████████ ████████████████▀▀▀ ███████████████▌ ███████████████▌ ████████████████ ████████████████ ████████████████ ████▀▀███████▀▀ | . ▬▬ VS ▬▬ | ████▄▄▄█████▄▄▄ ░▄████████████████▄ ▐██████████████████▄ ████████████████████ ████████████████████▌ █████████████████████ ███████████████████ ███████████████▌ ███████████████▌ ████████████████ ████████████████ ████████████████ ████▀▀███████▀▀ | /// PLAY FOR FREE /// WIN FOR REAL | │ | ..PLAY NOW.. | |
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pakhitheboss
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February 04, 2022, 10:38:03 AM |
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.. U knw almost 80% politicians are in crypto. Nothing to wry.
What's source of this? I do not think he can provide any source for that type of information. I have no clue also why politicians need to invest in cryptocurrency in general. If it is related to black money then creating shell companies is still far better than investing in crypto for them and now with 30% tax they will never invest in cryptocurrencies within india.
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JSRAW
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February 04, 2022, 01:31:26 PM |
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As mentioned, it's definitely a great blunder, not only because the government has taxed cryptocurrency at 30%, they are also not allowing to set off your losses in cryptocurrency, as mentioned by JSRAW, they have considered crypto income more like casual incomes made from Gambling, betting, lottery. This means it's clear they are not giving it the status of an organized market. Moreover this decision has ensured that there won't be any crypto startups in this country moving forward. At some point they will have to reduce the taxation because it's totally unfair that they are taxing 30% for crypto gains while 15% - 20% on stock gains.
I think they are considering crypto as similar to gambling, not stock trading but betting kind. In that case they should follow state specific gambling laws since the government has told the states to imply their on rules for gambling. State-specific laws are merely for organizing gambling, taxation is handled centrally only, they are treating the incomes from crypto as gambling, not treating the crypto trading as gambling altogether. Hardly a blunder IMO, may be a bit hasty decision but not blunder by any means. Considering every tom-dick-harry was filing PIL after PIL to ban or even news of 10 years jail time were popping here n there, not to mention virtually every media house, print media was busy on creating fud. I guess it would be too early to comment on future of crypto startup but with recent announcement they indirectly endorsed the crypto. First crypto community was fighting for "India wants crypto" now focus should be on crypto tax. Its a tiring process but future does look good.
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teosanru
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February 04, 2022, 07:22:50 PM |
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As mentioned, it's definitely a great blunder, not only because the government has taxed cryptocurrency at 30%, they are also not allowing to set off your losses in cryptocurrency, as mentioned by JSRAW, they have considered crypto income more like casual incomes made from Gambling, betting, lottery. This means it's clear they are not giving it the status of an organized market. Moreover this decision has ensured that there won't be any crypto startups in this country moving forward. At some point they will have to reduce the taxation because it's totally unfair that they are taxing 30% for crypto gains while 15% - 20% on stock gains.
I think they are considering crypto as similar to gambling, not stock trading but betting kind. In that case they should follow state specific gambling laws since the government has told the states to imply their on rules for gambling. State-specific laws are merely for organizing gambling, taxation is handled centrally only, they are treating the incomes from crypto as gambling, not treating the crypto trading as gambling altogether. Hardly a blunder IMO, may be a bit hasty decision but not blunder by any means. Considering every tom-dick-harry was filing PIL after PIL to ban or even news of 10 years jail time were popping here n there, not to mention virtually every media house, print media was busy on creating fud. I guess it would be too early to comment on future of crypto startup but with recent announcement they indirectly endorsed the crypto. First crypto community was fighting for "India wants crypto" now focus should be on crypto tax. Its a tiring process but future does look good. If the government wanted to clear doubts around crypto a simpler way was to just tax it as a normal income. By taxing it at the highest slab government itself is creating FUD for the sector. Starting the tax regime of new technology in such a negative fashion discourages the technology a lot. But yes one clarity we have got is that it's not getting banned and that is for sure. Because not only Income tax, the government has plans to bring in GST also on the service charges levied in crypto trading. This means government is ready to collect it's cut of revenue from crypto transactions. If they have thought of these means there is no way a plan to ban them. PS: 10 year Jail news was horrible LOL I remember writing about it on forum as it was mentioned in the draft bill for Virtual currencies.
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JSRAW
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February 06, 2022, 05:31:26 AM |
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~snip~ If the government wanted to clear doubts around crypto a simpler way was to just tax it as a normal income. By taxing it at the highest slab government itself is creating FUD for the sector. Starting the tax regime of new technology in such a negative fashion discourages the technology a lot. But yes one clarity we have got is that it's not getting banned and that is for sure. Because not only Income tax, the government has plans to bring in GST also on the service charges levied in crypto trading. This means government is ready to collect it's cut of revenue from crypto transactions. If they have thought of these means there is no way a plan to ban them.
PS: 10 year Jail news was horrible LOL I remember writing about it on forum as it was mentioned in the draft bill for Virtual currencies.
I won't use the word "FUD" with this decision but fair point and already mentioned that i would've liked more if it was under existing tax regulations. I'm optimistic and believe that we're heading on the right direction. It's just a matter of time that they will come to their senses and revise this policy. On funny note i think gov is under impression that every investor is printing shit load amount of money in crypto, hence 30% tax.
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pakhitheboss
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February 06, 2022, 06:19:08 AM |
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As mentioned, it's definitely a great blunder, not only because the government has taxed cryptocurrency at 30%, they are also not allowing to set off your losses in cryptocurrency, as mentioned by JSRAW, they have considered crypto income more like casual incomes made from Gambling, betting, lottery. This means it's clear they are not giving it the status of an organized market. Moreover this decision has ensured that there won't be any crypto startups in this country moving forward. At some point they will have to reduce the taxation because it's totally unfair that they are taxing 30% for crypto gains while 15% - 20% on stock gains.
I think they are considering crypto as similar to gambling, not stock trading but betting kind. In that case they should follow state specific gambling laws since the government has told the states to imply their on rules for gambling. State-specific laws are merely for organizing gambling, taxation is handled centrally only, they are treating the incomes from crypto as gambling, not treating the crypto trading as gambling altogether. Hardly a blunder IMO, may be a bit hasty decision but not blunder by any means. Considering every tom-dick-harry was filing PIL after PIL to ban or even news of 10 years jail time were popping here n there, not to mention virtually every media house, print media was busy on creating fud. I guess it would be too early to comment on future of crypto startup but with recent announcement they indirectly endorsed the crypto. First crypto community was fighting for "India wants crypto" now focus should be on crypto tax. Its a tiring process but future does look good. If the government wanted to clear doubts around crypto a simpler way was to just tax it as a normal income. By taxing it at the highest slab government itself is creating FUD for the sector. Starting the tax regime of new technology in such a negative fashion discourages the technology a lot. But yes one clarity we have got is that it's not getting banned and that is for sure. Because not only Income tax, the government has plans to bring in GST also on the service charges levied in crypto trading. This means government is ready to collect it's cut of revenue from crypto transactions. If they have thought of these means there is no way a plan to ban them. PS: 10 year Jail news was horrible LOL I remember writing about it on forum as it was mentioned in the draft bill for Virtual currencies. Government has only defined the tax part here. The regulation bill is yet to be presented. We still need to wait for the next session of the parliament when the proposed bill will be presented. More clarity related to the tax will be out in the coming days. It is too early to derive any conclusion at the moment.
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February 06, 2022, 11:32:46 AM |
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This sums up everything. https://economictimes.indiatimes.com/tech/technology/crypto-exchanges-to-brief-policymakers-on-tds-tangles/articleshow/89372406.cmsMumbai: The industry body representing cryptocurrency exchanges has decided to reach out to relevant policymakers to brief them about complications arising out of the government’s move to levy a 1% TDS on all crypto transactions.
The issue was discussed at the meeting of the Blockchain and Crypto Assets Council (BACC) on Saturday, where the overwhelming view was that this move would dent crypto trading volumes and drive small traders towards informal Person to Person (P2P) trading and decentralised exchanges (DEX).
Crypto exchanges derive a large chunk of their revenues from traders who frequently trade and pay a small sum on every trade.
According to the provisions of this year’s finance bill, the buyer of a cryptocurrency has to deduct 1% of the sale consideration and pay the amount as an advance tax to the government on behalf of the seller on every trade. The withholding will apply where sale consideration is more than or equal to Rs 50,000 (for specific individual payers) and Rs 10,000 for others. TDS must be deducted on both crypto-to-rupee and crypto-to-crypto swaps.
But people opposed to these provisions say the provisions are impractical and will lead to complications in compliance, thereby discouraging trading on formal exchanges.
For instance, to pay advance tax, the buyer needs to have details of the seller, such as name, PAN number, etc. As this information lies with the exchanges, not with the buyer, the buyer won't be able to remit money to the government.
No Clarity on Implementation
Moreover, day traders make multiple trades per day, often with small margins. Therefore, the volume of the TDS payouts could be substantial and also considerable time would need to be devoted to this exercise.
“Specific sections regarding TDS are still confusing. We believe multiple discussions are needed to come up with better systems or processes. We are very hopeful that the right actions will be taken,” said Sumit Gupta, CEO & cofounder, CoinDCX, one of India’s largest crypto exchanges. “We are happy that the industry has got clarity and confidence. However, I would also like to point out that it's two steps forward and one step back.”
Tax experts say that the government hasn’t thought through the tax proposals and hasn't consulted enough with the crypto stakeholders.
“The government has come up with tax regulations but has not clarified how to implement them. The way TDS regulations stand currently, it could severely dent crypto trading in India,” said Anoush Bhasin, founder of New Delhi based cryptocurrency tax advisory Quagmire Consulting.
The crypto community believes that policymakers should interact more with all the stakeholders—exchanges, market participants and tax experts—to understand the pain points of the industry.
“There were a lot of positives for the crypto industry in the budget. We believe the government has taken a step towards recognising digital assets. But the government should also look into the operations side of the exchanges to understand the impact,” said Atulya Bhat, CMO, BuyUcoin.
BACC plans to hold several knowledge sessions for policymakers to apprise them about the workings of the exchanges and how the taxes will impact their revenue models.
In their meeting, the BACC members discussed all details of the new crypto tax regime.
The crypto investor community has also been up in arms against the 30% tax on crypto currencies announced by FM Nirmala Sitharaman in the Budget.
“The thumb rule in taxation has always been to tax citizens as per their income. The rich end up paying more taxes than the poor. In this case, both are being treated in the same way. Imagine the rich, who are already in the 30% income bracket, won't have much of a problem, but consider the small investor who has invested less than Rs 50,000. Also, there were many people who were earning their income as freelancers, now they will be taxed at a flat 30%,” said Kashif Raza, founder, Bitinning, a crypto education platform.
During the last three days, the hashtags #reducecryptotax and #faircryptotax have been trending on Twitter. By Saturday evening, more than 63,000 people had signed the petition started by popular crypto influencer Aditya Singh and amplified by popular social media influencers like Sandeep Bahuguna, Pushpendra Singh and Kashif Raza.
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