India’s Union Budget 2024: Crypto Community Awaits Potential Policy Changes
As India prepares for the Union Budget 2024, the crypto community is eagerly waiting for potential policy changes that could benefit the industry. This year’s budget holds significance after India’s recent G20 presidency, where the crypto sector emerged as a key topic.
Crypto Industry Hopeful
Rahul Pagidipati, CEO of ZebPay, is optimistic about the budget and emphasizes the need for a regulatory framework that supports the crypto market. He believes that favorable tax treatments, such as reducing TDS and capital gains taxes, would encourage wider participation in the crypto market and promote innovation and blockchain integration into existing businesses.
Tax Treatment to Improve Revenue
Ashish Singhal, co-founder and CEO of CoinSwitch, reflects on the tax provisions introduced for virtual digital assets (VDAs) in Budget 2022. While the inclusion of VDAs in the Income Tax Act was a positive step, certain provisions have had unintended consequences. High TDS rates and the inability to offset losses have pushed Indian VDA users towards non-compliant foreign exchanges, resulting in potential legal issues and lower tax revenues.
CoinSwitch suggests reducing TDS on VDAs from 1% to 0.01%, allowing offsetting and carrying forward of VDA sale losses, and aligning VDA income treatment with other capital assets. Singhal believes that reconsidering tax treatment will reduce tax arbitrage, capital flight, and talent drain.
Hot Take: India’s Crypto Sector Awaits Favorable Budgetary Measures
The Indian crypto industry eagerly awaits the Union Budget 2024 for potential policy changes that could support its growth. Industry executives express hope for a regulatory framework that promotes innovation, reduces tax burdens, and aligns with global standards. Improving tax treatment for virtual digital assets is seen as crucial to prevent users from resorting to non-compliant foreign exchanges and to increase tax revenues. By creating a supportive environment, India can stimulate participation in the crypto market and ensure its sustainable development in the coming year.
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