The recently approved tax on crypto by India's Finance Minister Nirmala Sitharaman had people believing that digital asset trading will become completely legal.
India has been known for its minimal regulatory measures on cryptocurrencies. Just recently, the Finance Minister of India introduced a 30% tax on crypto holdings, and announced plans for digital rupees before 2023.
This was seen as a green light, and most thought that crypto will become completely legal in India.
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While the tax would indicate that digital assets could bring additional income to the country, the Chairman of the Central Board of Direct Taxes (CBDT) JB Mohapatra clarified that "crypto trade or the digital assets transactions do not ipso facto become legal or regular just because you have paid taxes on that."
The main point of the tax, according to Mohapatra, was to determine the number of crypto owners, which will help create a set of rules that can be presented as cryptocurrency regulations.
Likewise, the Government of India looks to track market movement between exchanges and individuals in order to to avoid cases of money laundering or criminal funding.
While the framework is still uncertain, the upcoming developments in crypto regulations, and the creation of a safe digital trading environment have been acknowledged by multiple owners of crypto exchanges and digital asset-based platforms in India.
However, it is unclear how the public will react to the taxation of crypto holdings. A few days ago, Thailand scrapped the plans for a 15% capital gains tax after receiving major backlash from the crypto community.
