Tag: nirmala sitharaman finance minister india crypto fear high tax continuation cryptocurrency

India concluded its general elections on June 1, with results last week paving the way for the re-election of Narendra Modi as Prime Minister for a third consecutive term. As part of PM Modi’s newly constituted cabinet, Nirmala Sitharaman has been re-assigned to serve as the finance minister of the country after first taking charge of the ministry in 2019. The crypto community of India has expressed mixed reactions to Sitharaman’s re-appointment as finance minister.

Cryptocurrencies in India have been under Ministry of Finance’s scanner. Since 2022, all profits from crypto transactions in India are subject to a taxation of 30 percent, while a 1 percent Tax Deducted at Source (TDS) is applicable on the transfer of Virtual Digital Assets (VDAs).

Dilip Chenoy, the chairperson of the Bharat Web3 Association (BWA), congratulated the new government and said that the Web3 advisory group would continue to collaborate with officials to foster Web3 growth.

“At BWA, we remain committed to collaborating with the government to foster the growth and development of the Web3 sector, with the aim of establishing India as a global hub for Web3. We look forward to our continued engagement and extend our support to the government for the development of forward-looking regulations that promote innovation while prioritizing consumer protection in the ever-evolving Web3 space,” Chenoy wrote on LinkedIn.

The Indian crypto circle has been waiting for FM Sitharaman to revise the tax laws imposed over the crypto sector. Despite the outcry, the finance minister did not announce any taxation relief for the crypto sector while presenting the interim annual budget earlier this year.

Her re-appointment to the finance minister’s position has sparked concerns among India’s crypto community, who fear that no tax reforms are in the pipeline for the digital assets industry. Many have taken to social media to express their thoughts on the development.

FM Sitharaman is expected to present the full budget for the FY 2024-2025 next month. Crypto commentators are expecting the finance minister to reduce the one percent TDS cut on each crypto transaction to 0.01 percent as part of her upcoming budget presentation.

In March this year, Sitharaman had said that India was not seeing any cryptocurrency as a ‘currency’ option. At the time, Sitharaman had said that “assets created in the name of crypto can be assets for trading, assets for money making and assets for many other things.”