Indian Tax Officials Say Cryptocurrency Gains Are Similar To Lottery Winnings.
The Indian government has been hesitant to legalize cryptocurrencies. However, they are well aware that there is a lot to be made from them through taxes.
According to the news source Press Trust of India, the Indian government is investigating how it may charge the whole value of a transaction involving digital assets under the goods and services tax (GST). Crypto services supplied by trading exchanges are now classified as financial services.
GST officers consider cryptocurrencies to be equivalent to lottery, casino, gambling, or betting profits, which are subject to 31.20% GST on the whole amount. The tax rate on stock investments, on the other hand, ranges from 0% to 15%, depending on whether it is reported as business income or short-term capital gain.
According to BrokerChooser, a broker search and comparison website, India has 100 million cryptocurrency users, the most in the world.
According to the provisions of the Indian budget for 2022-2023, all cryptocurrency gains would be taxed at a flat 30% rate. The government has also enforced a 1% tax deducted at source (TDS) on all cryptocurrency transactions, regardless of profit or loss.
According to analysts, this TDS is expected to reduce speculative trade and may reduce the amount of crypto transaction in India when it goes into force in July. According to estimations by Nischal Shetty, creator of India’s cryptocurrency platform WazirX, it may generate an additional $100 million in revenue.
Aside from crypto trading, the government is contemplating taxing cryptocurrency mining profits as commodities or services. Furthermore, the government intends to include cryptocurrency trading on overseas sites under the scope of GST.
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