Indian authorities will introduce a 30% tax on income from digital asset transactions ahead of the launch of the digital rupee. The initiative was presented by the country’s Finance Minister Nirmala Sitharaman during the presentation of the annual budget, writes ForkLog.
Digital Rupee launch
The Indian government has decided to launch its own digital currency on April 1, 2022. The new rupee will be based on blockchain and other modern technologies.
According to Sitharaman, the CBDC “on the basis of blockchain and other technologies” will allow the transition to a more efficient and cheaper system of managing the national currency, and will also give a “big boost to the economy.”
The launch of the digital rupee is expected in the new fiscal year, which is coming in April, the head of the Finance Ministry added.
“There has been a phenomenal growth in transactions involving virtual digital assets. Their scale and frequency required special tax treatment. […] Any income from the transfer of such an asset is taxed at a rate of 30%. No deductions are allowed, with the exception of the purchase price,” the official commented.
At the beginning of 2021, India reported a possible legal ban on cryptocurrencies, even talking about criminal liability for owners.
In the middle of the year, there was information that the government would legalize digital currencies as an asset class.
However, in November there was renewed talk of the government’s intention to ban most private currencies. This caused panic in the local market, which led to a short-term local drop in the price of Bitcoin by 15%.
In December, the media reported that the authorities would still regulate digital assets instead of banning them.