Crypto Taxations fetch India $19 million in 9 Months

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By A D

India has been making headlines lately due to its strict stance on crypto. The country’s regulatory framework for cryptocurrencies has undergone significant changes in recent years, and its stance has become even more stringent in the last few months.

The latest development in the crypto scenario in India is that country’s TDS on crypto transfers has yielded 19 million USD in just nine months. TDS is a type of tax that is deducted at the time of payment. In the case of cryptocurrency transactions, TDS is deducted at a rate of 1% for transactions over 1,00,000 INR (approximately 1,350 USD). This TDS is applied to all crypto transactions, including buying, selling, or transferring cryptocurrency.

The introduction of TDS on crypto transactions is just one example of India’s growing regulatory framework for cryptocurrencies. The Reserve Bank of India (RBI) banned all banks from dealing with cryptocurrency exchanges in 2018, citing risks to financial stability and potential money laundering concerns. This ban was lifted by the Supreme Court of India in March 2020, which was seen as a positive step towards the legalization of cryptocurrencies in India.

However, the regulatory environment for cryptocurrencies in India is still challenging. In 2021, the Indian government introduced a bill that proposes banning all private cryptocurrencies, including Bitcoin and Ethereum, and creating a framework for the development of an official digital currency issued by the RBI. The bill also proposes fines and imprisonment for those who mine, hold, or trade cryptocurrencies.

India’s stance on cryptocurrencies is also reflected in its role in global cryptocurrency regulation. The country is a member of the G20, which has called for the regulation of cryptocurrencies to prevent money laundering and terrorism financing. India has also taken steps to regulate cryptocurrencies under its anti-money laundering law, requiring exchanges to follow Know Your Customer (KYC) and Anti-Money Laundering (AML) guidelines.

the release ofthe gazette shows yet another regulation applied of cryptocurrencies in India
India recently implemented money laundering laws for cryptocurrencies and digital assets. Image Courtesy: twitter

So, what does this mean for the crypto industry in India? Despite the regulatory challenges, the crypto industry in India has seen significant growth in recent years. The country has a large and growing population with a high level of tech literacy, making it an attractive market for crypto businesses. According to a report by Chainalysis, India ranks second in the world for cryptocurrency adoption, with over 15 million users.

However, the future of cryptocurrencies in India remains uncertain. The proposed ban on private cryptocurrencies could have a significant impact on the industry, forcing businesses to shut down or move their operations overseas. It could also discourage further innovation in the crypto space in India, stifling the development of new technologies and use cases.

India’s regulatory framework for cryptocurrencies is complex and constantly evolving. The introduction of TDS on crypto transactions is just one example of the country’s growing regulatory environment. While the crypto industry in India has seen significant growth in recent years, the proposed ban on private cryptocurrencies could have a significant impact on its future. It remains to be seen how the situation will develop, but it is clear that India’s stance on cryptocurrencies will continue to be closely watched by industry observers around the world.

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