In February, the countys finance minister Nirmala Sitharaman gave them hope byintroducing a tax schemeand recognizing the industry.
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There are two layers to Indias new cryptocurrency tax.
However, the catch is that you cant offset your losses, even within cryptocurrencies.
This law has been in effect since April 1.
The 1% TDS applies on all transactions.
Sathvik Vishwanath of cryptocurrency exchange Unocoin said that these rules go against the fair trading practice of the market.
A TDS like 1% for every trade could make any speculative instrument become illiquid fast!
This will go against the fair market prices for those instruments and can push trading underground.
But taxation is not the only roadblock for Indias potential cryptocurrency investors.
Another incumbent, WazirX, had stopped taking UPI-based payments from December.
For years, Indias central bank has disliked the idea of cryptocurrency trading.
While this is data from a short period of time, the decline is very sharp.
And thats not a good sign for any investment vehicle.
The cryptocurrency industry in India is still engaging with authorities to ease up some of the regulations.
One of the proposals they have put up is to reduce TDS from 1% to 0.01%.
He added that clear guidelines and regulations around cryptocurrencies will stop people from becoming averse to investing in them.
Currently, theres no specific law around regulating crypto apart from the taxation rules.
Reports suggest that India will look atglobal rules around the industryto form its own regulations framework.
We cant expect that to arrive in a matter of months.
For now, there remains a layer of uncertainty and hesitancy around cryptocurrency investments in India.
That’s one heck of a mixed bag.
He likes to say “Bleh.
That’s one heck of a mixed bag.
He likes to say “Bleh.”
