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Those who dream of becoming rich overnight by tax on crypto currency will now get a big shock

The dream of becoming rich overnight by investing in cryptocurrency is now going to be a big blow to those who see it. The budget proposed to tax crypto or digital assets at the rate of 30 per cent, which will come into effect from the next financial year. Apart from this, other taxes including TDS will also be levied on it. Experts say that in such a situation, the high tax burden may make small investors distance from crypto, which has the largest number. It will also have an impact on the fast growing crypto industry.

In the budget, the government had announced that the highest rate of 30 percent tax would have to be paid on the gains from crypto. Along with this, one percent TDS will also be levied on every transaction. Apart from this, preparations are also being made to bring crypto under the purview of GST. In comparison, investing in shares is more profitable on the tax scale. Profits in shares are taxed only 10 to 15 per cent.

More attractiveness to small investors

According to industry estimates, the crypto market in India has crossed Rs 1 lakh crore. While the number of crypto investors is more than 100 million, it is the highest in the world, but 80 percent of crypto investors in India are in the category of investing 500 to two thousand rupees. The US ranks second with 27.4 million crypto investors and Russia third with 17.4 million investors. While Nigeria ranks fourth with 1300 million investors.

Investor himself responsible for losing money

The market regulator SEBI monitors investment in shares and takes immediate action against companies if anything is found wrong. Crypto has no regulator. The Finance Ministry and Reserve Bank Governor have also said that crypto is not recognized in India. In such a situation, if the investment in crypto sinks, the investors themselves will be responsible for it. The Central Board of Direct Taxes (CBDT) has also said that taxing crypto does not mean treating it as legal currency or property.

The crypto industry will fade

In terms of number of investors, India has very fast surpassed the US to reach the top. Due to this, many new crypto exchanges and companies related to its business have started in India. Industry experts say that if small investors stay away from crypto due to the high tax rate, it will have a direct impact on the industry and it may be difficult for them to run the business going forward. In such a situation, the crypto industry may collapse before it reaches the heights.

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