According to Sitharaman, “Our goal is to develop a global standard operating procedure for regulating crypto assets while recognizing that central banks are authorized to issue cryptocurrencies. “Cryptocurrencies issuing authority will be recognized by the central bank, Sitharaman said in a post-budget interview with Network18 group’s MD Rahul Joshi.
As for the rest of the assets, they use financial technologies that are extremely useful, so they must also be discussed, as regulation cannot be done solely by a single country, it must be a collective effort because technology has no borders,” she said regarding her agenda for the G20 meeting in Bengaluru later this month.
G20 Agenda and Crypto trading in India
During FM Sitharaman’s Union Budget speech, no announcement for the VDA sector, so this made unhappy for the Crypto and virtual digital asset industry players. Because the sector expects some relief on the tax front, particularly the 1 percent tax deducted at source (TDS) on all transactions to come down to 0.1 percent.
To get clarity on crypto for this year, Some of the industry players though were banking on India’s G20 presidency. As Bitbns CEO Gaurav Dahake told Moneycontrol on February 1, “We also expect to see some positive developments during the second quarter around G20. As this year India is holding the presidency, they are working on crypto as one of the key themes.”
In 2023, an updated Finance Bill mentioned penalized for the non-payment of TDS of VDAs and include a jail term of up to six months or a penalty of unpaid TDS amount.
- Sitharaman, “Our goal is to develop a global standard operating procedure for regulating crypto assets.”
- No announcement for the VDA sector made unhappy for the industry players.
- A jail term of up to six months or a penalty of unpaid TDS amount is mentioned in an updated Finance Bill.
- The government denied treating crypto asset trading as illegal.
- Now, we have put a taxation framework for crypto assets, said Finance Secretary.
The government denied treating crypto asset trading as illegal a day after announcing it would tax gambling winnings the same way. Finance secretary T V Somanathan said in an interview with Bloomberg Television, “They are in a grey area, and it’s not illegal to buy and sell crypto,”
He also said, “now, we have put a taxation framework for crypto assets similar to treat winnings from horse races, or from bets and other speculative transactions.”
On Tuesday, the government proposed taxing income from virtual asset transfers at 30% in an effort to remove any legal uncertainty around these transactions after years of dithering. Despite the warnings of central banks about the risks of money laundering, terrorist financing, and price volatility, the steep tax rate on crypto could dissuade trades that have been soaring in India.
Legislation regulating cryptocurrencies is being drafted by the government, and before lawmakers can consider it, it has to be approved by the Union Cabinet.
Somanathan said, “The ongoing debate is What will happen to Crypto’s future regulations. The government would stick to taxing any income that is earned from such transactions, instead, they won’t jump the gun on regulation.”
According to the Government, In the year starting on April 1st, the Reserve Bank of India plans to launch its digital currency, while private virtual coins will not be legal tender.
