As India’s Union Budget 2024 announcement approaches, the web3 community in India is urging changes in cryptocurrency tax regulations. Despite consistent appeals from the web3 community in the past two years, the Indian government has not revisited crypto-related tax laws. Many in the sector argue that these laws hinder crypto growth in India and lead to a talent exodus to more crypto-friendly nations.
Netizens Demand Change In India’s Crypto Tax Law
India’s Finance Minister Nirmala Sitharaman is set to reveal the budget provisions for the fiscal year 2025 on February 1. In preparation, the Indian crypto community has used the hashtag ‘#ReduceCryptoTax’ on social media platforms.
Through social media, the crypto sector is expressing three main demands to the Indian government. These include advocating for more flexible tax slabs, reducing the Tax Deducted at Source (TDS) from 1% to 0.01% on each crypto transaction, and allowing the carrying forward of losses, similar to practices in the stock market.
Pushpendra Singh, Co-Founder of SmartViewAi in India, took to X and expressed how India’s crypto tax system is the “worst” globally. Attaching the trending hashtag of ‘ReduceCryptoTax’, Singh noted that 1% TDS coupled with a 30% crypto tax slab, no loss set off, and no banking support positions the tax regime in India as the worst in the international arena.
In addition, Dr Sathvik Vishwanath, the CEO and Co-Founder of Unocoin, labeled the crypto tax regime in India as “unfair.” In a recent post on X, Vishwanath voiced for an amendment in crypto taxation laws in the country, citing several problems that come with the existing regulations. The Unocoin CEO wrote, “Unfair taxation is not only setting our #crypto industry behind but also increasing the time needed to fix deficiencies & compete with global landscape. Amending our taxation laws helps us reach heights sooner!”
Also Read: Union Budget 2024: Has India’s G20 Presidency Set Precedent for Crypto Reforms?
Other Changes Sought By Indian Web3 Community
According to a thread on X by Keyur Rohit, a crypto influencer and YouTuber, anticipated changes in India’s crypto law include the establishment of a clear legal framework and tax regularization. In addition, the sector also looks forward to an amended definition for Virtual Digital Assets (VDAs), emphasizing exclusions for tokenized assets with proven underlying value.
Moreover, there’s a call for policies fostering innovation and research in the digital asset space to recognize a $10 trillion opportunity in real-world asset tokenization. Furthermore, Rohit stated that the year 2024 is envisioned as a transition to imperative application for the blockchain industry in India as it’ll integrate AI and other advanced technology.
Other demands by the crypto community include encouraging Web3 startups through special economic zones. In addition, the thread mentioned that people are advocating tax incentives and sandboxes to stimulate growth. Moreover, the ask for a reduction in TDS remained persistent.
Also Read: 1% TDS on Crypto: How Does It Impact Crypto Investors In Indian Union Budget 2024 ?
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