Experts say investors should be at ease as the Income Tax Department of India is allegedly considering charging crypto traders and crypto exchanges shortly.
According to ET Now, the tax department, part of India’s Ministry of Finance, has expressed interest in taxing crypto profits through trading and exchanges.
According to the authorities, the move does not entitle cryptocurrencies to a legitimate asset class status.
In an interview with Cointelegraph, Indian entrepreneur Nischal Shetty, CEO of WazirX crypto exchange, stated that gaining clarification on crypto-related Goods and Services Tax (GST) will aid in determining the asset class of cryptocurrencies.
He stated that it is self-evident that your crypto profits are taxed in the same way as regular income and must be reported on your income tax returns.
It is unclear if the GST would be applied to the amount of bitcoin purchased or the transaction fees paid by the customer.
According to the first report, the Indian government believes that any operations that produce money in cryptocurrencies must be taxed.
However, the cabinet’s soon-to-be-released legislative proposal will give further clarification on this choice.
On January 25, the Reserve Bank of India (RBI) released a notice that explores the use cases for a digital form of fiat currency.
While the government sees only two realistic alternatives for cryptocurrency, acceptance or total ban, the RBI intends to deploy its own version of CBDC.