India’s 30% flat levy on all capital gains made on cryptocurrencies kicked in on April 1 in a development likely to stifle the relatively nascent industry in the country.
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Fast facts
- Finance minister Nirmala Sitharaman has been facing investor backlash over her February proposal for the new tax.
- A 1% tax deducted at source (TDS) on every crypto transaction will kick in on July 1.
- The tax framework, which passed parliament just over a week ago, doesn’t allow investors to offset the gains against losses made on other cryptocurrencies.
- Although the regulatory clarity was initially welcomed, calls from India’s central bank for a blanket ban have led to mixed messages for investors.
- The tax may convert day traders to long-term investors or lead to an exodus of those unwilling to make that change to crypto-friendly jurisdictions, some opine.
See related article: India’s tax bogeyman is scaring off young crypto investors