India’s Union Budget 2024-25: What Does it Mean for Cryptocurrency?
India recently unveiled its Union Budget for the year 2024-25, sparking speculation and concern within the cryptocurrency community. Finance Minister Nirmala Sitharaman’s budget address failed to address the digital currency industry, raising questions about the government’s stance on this rapidly evolving sector.
Community Response to Unaddressed Crypto Industry
The budget outlined key priorities for economic growth, focusing on agriculture and employment, while neglecting to mention virtual currencies. The absence of any regulatory framework for digital assets in the budget has left stakeholders disappointed, as it fails to foster innovation and investment in the sector.
- Important modifications were proposed, but digital currency assets were not addressed.
- The existing digital currency tax framework remains unchanged.
Digital Currency Community’s Reaction
- High-profile individuals like developer Vijay Saran have expressed concerns about the lack of mention of digital currency in the budget.
- Saran believes that the status quo from 2022 will continue, with crypto transactions taxed at 30% and a 1% tax deducted at the source.
Impact of Crypto Taxation in India
The stringent tax regime in India has already had significant repercussions on the digital currency market. Trading volumes on Indian exchanges have plummeted by 97%, with active user participation down by 81% since the introduction of these taxes. This has led to substantial losses estimated at 59 billion Indian rupees ($700 million) annually.
Potential for Government Revenue Increase
A study by the National Academy of Legal Studies and Research suggests that capping crypto Tax Deducted at Source (TDS) at 0.01% could double the government’s revenue from the industry.
Hot Take: The Future of Cryptocurrency in India
The future of cryptocurrency in India remains uncertain following the Union Budget 2024-25. The lack of clarity and regulatory framework for digital assets could hamper the growth and innovation of the industry. Stakeholders will be closely monitoring any developments or announcements that may impact the cryptocurrency landscape in the country.
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