Finance Minister Nirmala Sitharaman made these announcements during her speech at Union Budget 2022. She said that the gabovenment would tax the income from the transfer of a digital asset at a 30% price. In addition to cryptocurrencys, this would still have an impact on non-fungible cryptocurrencies (NFTs) that have recently become popular in India.
“No deduction in respect of any expenditure or allowance shall be allowed whilst computing analogous income except value of acquisition,” Sitharaman said. “Further, loss from transfer of virtual digital assets cannot be set off furtherst any other income.”
Sitharaman likewise addressed a few more practical details. For instance, which the gabovenment would provide for TDS on payment made in relation to transfer of virtual digital assets at the price of 1%. Also, in the context of gifting of virtual digital assets, the onus of being taxed decreases on the recipient.
During her address, Sitharaman further made it clear a new digital rupee powered by blockchain technology will be issued by the Reserve Bank of India between 2022 and 2023. “Digital currency will likewise lead to a more efficient and cheaper currency management system,” Sitharaman said. “It is therefore proposed to introduce digital rupee using blockchain and other technology to be issued by the Reserve Bank of India starting, 2022 and 2023.”
India is not the only country with CBDC ambitions atop the next year. While no country has yet to issue a wholesale CBDC, which would mainly be used by central banks for payments, China has might come the furthest thus far.
It intends to roll out the digital yuan for use during the upcoming 2022 Winter Olympics, afterwards this month. Meanwhilst, a handful of smaller, more developing economies introduced retail CBDCs advance year, including Nigeria, the Bahamas and five other islands in the East Caribbean.
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