Cryptocurrency players want clarity from Indian government

Country’s unclear relationship with cryptocurrency has caused a lot of problems. Hence, the need to introduce norms during the Union Budget 2022

PRAVASISAMWAD.COM

Cryptocurrency players have asked the government to bring in clarity regarding the definition of income and gains for crypto assets. ET talked to some of the big players in the industry and found out that the country’s unclear relationship with cryptocurrency has caused a lot of problems. Hence, the need to introduce norms during the Union Budget 2022.

Amid talks of a cryptocurrency regulation bill (the bill was to be introduced during the Winter Session of the Parliament in 2021), cryptocurrency has found itself in a variety of situations: from a “complete ban” to being more of a “regulated asset” now, according to reports.

The bill, however, faces uncertainty, and has been kept aside for the time being. Sumit Gupta, Co-Chair of the Blockchain and Crypto Assets Council (BACC) and Co-founder and CEO, CoinDCX was quoted by ET saying that the nature of transactions where crypto is involved in commercial transactions, appropriate GST as per the underlying GST on goods and services involved can be levied. However, where it is an investment and trade-related to investment appropriate long term or short term capital tax can be levied in line with other investment transactions.

Finance Minister Nirmala Sithataman and Prime Minister Narendra Modi have also talked about crafting a cryptocurrency framework, with a view to establish global standards of digital assets

“Further there needs to be provision for capturing profits from trading transactions as business income wherever relevant. In case transactions involve a party from beyond the Indian geography appropriate reporting to RBI under FEMA can be done similar to investment under LRS as well,” he said.

Sharan Nair, Chief Business Officer of CoinSwitch Kuber, said that many macroeconomic developments in India and the world over the last year had accelerated crypto adoption in India. Leading crypto exchanges follow strict self-regulatory practices to ensure customer protection. “We hope the upcoming Union Budget will bring in regulatory clarity and help standardize best practices and address misconceptions around this emerging asset class. A regularised environment will encourage more Indians to start their crypto investing journey, promoting financial inclusion in line with the government’s vision,” he said.

Finance Minister Nirmala Sithataman and Prime Minister Narendra Modi have also talked about crafting a cryptocurrency framework, with a view to establish global standards of digital assets.

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