Changing its view on digital currencies, the Indian government may soon enable their usage as an asset class in India. This implies that the people in India may be permitted to purchase or sell digital currencies like gold, shares, or bonds. To make sure there is a safe space for trading for the crypto investors, there are chances for the government to roll out new regulations for digital currency exchanges in the nation that will include a new system of crypto trading taxes. Let us see some news on cryptocurrency taxation India.
The verdict as and when it arrives will be the initial official guideline on digital currencies in India. The shift has been hinted at in a current report by a renowned media house. It states that even though the Indian government may enable the use of digital currency as an asset, their usage as a currency may be restricted. This implies that the people holding digital currencies like Ethereum or Bitcoin cannot use them for transaction purposes in India and there will be day trading cryptocurrency taxes levied on the digital currency holders.
Discussions regarding the social regulation are still on according to the sources that are cited in the report, and there are possibilities that the government will introduce a crypto trading taxes on the trade of crypto in India. Another report states that there are plans of the government to introduce 1% GST on crypto exchanges to be collected at source. The exchange is likely to collect this from the investors that use that platform.
The report further states that the digital currency exchanges will be classified into 3 sectors: facilitators, trading platforms, and brokerage which is mainly electronic, and offers software for conducting trades and evaluating the market.
Other than the cryptocurrency taxes and the classifications, the Indian government is aiming to bring in guidelines that will navigate around advertisements by such digital currency platforms. The report states that the government may stop the exchanges and platforms from “active solicitation”. In this respect, it is likely to imply a limit on the various advertisements that recommend people to invest their cash in digital currencies without warning them about the prevailing loopholes. With the crypto tax calculator India, people can calculate the amount of their tax.
The sources have also stated that the details of the new crypto bill 2021 have also been finalized by the Indian government and it could be presented before the cabinet for considering it in the upcoming two or three weeks.
Excitingly, the sources also shared that SEBI (Securities and Exchange Board of India) could be handed the power to regulate the Indian crypto industry. For those who do not know, SEBI is a regulator for the commodity and the security market in India. It functions under the jurisdiction of the Ministry of Finance and controls the Indian stock market.
The Bottom Line
With the advent of the new crypto bill in India, many changes are expected to happen that will change the way digital currencies were previously used in this country. One such change will be the crypto trading taxes, where the traders will have to pay 1 percent GST on their crypto holdings to the digital currency exchanges.
Frequently Asked Questions On Crypto Trading Taxes
1. Do you pay taxes on crypto trades?
As of now, there were no taxes on digital currency in India. But as soon as the new crypto bill is enacted, the traders will have to pay 1% GST on their crypto exchanges.
2. How does crypto trading get taxed?
Crypto trading is similar to stocks. So the holder will have to pay 1% GST on their total crypto traded.
3. How can I avoid paying taxes on crypto?
You may wonder how to save tax on cryptocurrency. There are ways by which you can avoid paying taxes on a digital currency like purchasing crypto in your IRA, purchasing digital currency in your life insurance policy, and many more.
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