India will tax cryptocurrencies

India will tax cryptocurrencies

In the near future, the Indian authorities plan to introduce taxation of bitcoin exchanges and operations with digital assets instead of banning cryptocurrencies. This is reported by The Economic Times.

According to sources, the decision does not mean recognizing cryptocurrencies as a full-fledged asset class. Authorities believe it is reasonable to tax profitable activities, the publication added.

The Reserve Bank of India (RBI) plans to test its own digital currency by the end of 2021, according to journalists.

At the same time, Indian cryptocurrency exchanges have launched promotional campaigns and giveaways of digital assets for the festival season that began on September 10, ET writes. This is how trading platforms plan to attract new retail investors.

Recall that on September 7, former RBI deputy managing director Ram Subramaniam Gandhi said that digital assets in India should be taxed depending on how they are acquired.

In June, the media learned of the country's authorities' plans to introduce a 2% tax on cryptocurrency purchased on foreign exchanges. In July, journalists reported on the possibility of introducing an additional 18% tax for foreign trading platforms.

In January, a bill that would ban cryptocurrencies was introduced in the Indian Parliament. However, the document was never presented. In June, Bloomberg reported on the country's government plans to consider regulating the digital asset class.

By the end of 2020, Chainalysis estimated the number of crypto-investors in India at 15 million people, and the value of their assets at $38.8 billion.

Jack Evans

About the author

I became a crypto asset owner in 2014, when the industry was in its infancy. Before that, I was working in the classic US and European stock markets. Since then, I have gained extensive experience in both cryptocurrency investing and day trading. I am happy to share with readers my experience with crypto exchanges, DeFi and NFT instruments. 

View All Posts By Jack Evans