New Delhi: In India, the cryptocurrency market has been rapidly expanding. According to a Nasscom analysis developed in collaboration with WazirX, it is estimated to reach $241 million by 2030.
In the absence of a regulator to regulate the market, the expanding market has also been a source of concern. Crypto exchanges are seeking clarity on the status of cryptocurrency as an asset class and its taxation regulations amid this regulatory ambiguity. Here's what the crypto sector have set their budget expectations.
“Web 3.0 is at a nascent stage as the internet was in 2000. The giants like Google, Apple, Amazon, and Facebook were being conceptualized and launched. And in the following 20 years, massive value was created for their customers and owners. The next generation on Web 3.0, the next version of the internet, are on the table now. Crypto assets are a fuel for this internet. Not just currencies but a range of other digital assets like non fungible tokens, wrapped asset token etc that permit fractional ownership of a wide range of assets hitherto unavailable to mass market and a way for entrepreneurs, artists, and even students to raise money for their endeavors or education like was never possible before. We need to have a progressive regulatory framework that can create an enabling environment where innovation can thrive in a legal way – and India’s entrepreneurs can create platforms that, not just India but the whole world we use. It is a moment in history that we cannot miss. We need to have a regulation out soon” says Saurabh Tripathi, managing director and senior partner, BCG
Arjun Khazanchi, Co-founder and CLO Rooba Finance says, "There are numerous expectations from the 2022 budget. The focus will be around continuing to help India create a strong base towards its journey to become a $ 5 trillion economy. Towards that end the government is expected to roll out support to enable the growth of its National investment pipeline to support the development and financing of large scale public projects which will enable further economic growth and development.
To this end a lot of the development is expected to be towards fulfilling the prime ministers stated goal of making India have a net carbon emission of zero by 2070. As the K shaped recovery has hurt certain industries while inflation is reducing the bottom line for a lot of products, the government is expected to have a dynamic approach to solving issues faced by these sectors.
When it comes to cryptocurrency the expectations are more specific.
The industry sees crypto being formally brought into the tax code.
This involves some of the following:
1) both sale and purchase of crypto will be brought under the fold of the TDS/TCS provisions
2) expectations of crypto having a higher tax rate of 30% to bring it in line with winnings from lottery as opposed to capital gains.
3) proposals to not allow losses from the sale of cryptocurrency to be offset or carried forward.
This is to prevent tax loss harvesting."
Sathvik Vishwanath, Co-Founder & CEO, Unocoin says, “When it comes to cryptos, I am not expecting anything amazing to come out of budget this time. If at all, the income tax confusions may get cleared up. This is not the time to propose new regulations.”
“Various macroeconomic developments in India and the world over the last year have led to a rise in crypto adoption in India. Today, leading crypto exchanges follow strict self-regulatory practices to ensure customer protection. We hope the upcoming Union Budget will bring in regulatory clarity and help standardize best practices, address misconceptions around this emerging asset class. We believe a regularised environment will encourage more Indians to start their crypto investing journey, promoting financial inclusion in line with the government's vision," said Sharan Nair, Chief Business Officer, CoinSwitch Kuber.
#mute
