Present Status of Cryptocurrency in India
Digital assets have been a topic of controversy worldwide for a while now. Debates about its receiving legal status in India have been ongoing. During the discussion of the country’s budget, it was announced that a 30% tax would be imposed on crypto earnings.
However, in a recent post by the Lok Sabha, several questions regarding the status of cryptocurrencies in the country have been answered by the Minister of State in the Ministry of Finance, Shri Pankaj Chaudhury.
The most anticipated question regarding the legal status of cryptocurrency in India has been eliminated. As of now, cryptocurrencies are unregulated in the country.
The next question was regarding the infrastructure costs included in crypto mining. And if it will be counted as the cost of acquisition and “permissible deductions”? The minister has answered that finance is a new addition to the Finance Bill, 2022, i.e., the 115BBH section. It will allow imposing taxes on ” any income from transfer of VDA (virtual digital assets). Also, the infrastructure cost won’t be calculated as the acquisition cost and will not be eligible for deductions.
The Ministry has also informed that according to the proposed section, any loss incurred during the transfer of virtual assets won’t have the permission to be set off against the income acquired from the transfer of another VDA.