Crypto is Legally Recognized by India

As the Crypto Ban was looming for all the Indians, it is quite a relief that the crypto is legally recognized by India by putting 30% Tax on the profit as well as 1% TDS. According to the government we Indians have to pay tax on virtual digital assets like coins, tokens, non-fungible tokens (NFT) or any other digital assets. Along with that Digital Rupee will be issued in the 2022-2023 time frame.

PC: https://unsplash.com/photos/BJl5EeSugw0

So according to section 115BBG, we have to pay 30% tax on any digital assets we get from others or on the profit we got after the trade. For example, if we get 100 USD from the sale of any digital assets we have to pay 1 USD TDS + 30 USD Tax which means we will have only 69 USD. This amendment will come into effect from 1st April 2023 which means we have around 1 year to either sell our assets or start paying the tax.

With this amendment, we can say that India is finally on the path to legitimizing the crypto, which is a great step, to be honest. With this more and more companies and individuals will try to adopt the blockchain and crypto and thus eventually India will become an even bigger market for crypto.

But the main question is does this 30% tax can push away the investors. 30% tax is too much and if we compare with the equity it's almost 3 times. Where in equity gain we have to pay 10% Long Term Tax but in crypto's case it is 30%. Still, we are in the early phases and it is I guess the first step where we can say that it is the right step in the right direction. I will feel that many people will stop trading and start buying it for the long term because if a coin or token is giving us 100X or 50X then giving away 30% is ok. People who are earning like 12 Lakhs per annum is anyway paying the 30% tax on their income so people can think that this earning is over and above their personal income.

Now many people do not earn 12 lakhs per annum but still, I feel if it is recognized and if I have to pay 30% tax, I am ok. I am not going to sell crypto for now and when my crypto portfolio becomes double or triple then paying a small amount is fine.

One more option is if we have a service where I will pay in crypto and will get money in Paypal with a 10% cut is also quite a good service to have. I think we will get this kind of service in the future and with this people will be willing to pay 10% rather than 30%.

Posted Using LeoFinance ^Beta