India keeps a 30% crypto tax in place and has no plans for Bitcoin ETF approval, dimming hopes for friendlier crypto regulations.
Assuaging expectations for more benevolent crypto regulation, India’s Ministry of Finance has confirmed that the country’s cryptocurrency tax laws will not be altered.
Additionally, the government has ruled out licensing cryptocurrency ETFs or Bitcoin anytime soon.
India’s Crypto Tax Rate Is Still 30%
Recent reports indicate that the country’s Ministry of Finance upholds stringent crypto rules, rejecting proposals to approve Bitcoin ETFs and immediately amend the 30% tax on cryptocurrency gains.
A well-known X platform, Crypto India, issued an X post alerting the community to the nation’s stringent policies.
Notably, this ruling upholds the current tax structure, which levies a 1% Transaction Digital Asset tax on transactions over INR 10,000 and a 30% tax on cryptocurrency income.
In keeping with its cautious approach to crypto regulation, the government has also stated that it will not approve Bitcoin or cryptocurrency exchange-traded funds (ETFs) anytime soon.
A Bitcoin ETF in the country is unlikely in the immediate future, despite recent rumors that the country may embrace Bitcoin.
A representative for the ruling party recently underlined the significance of a Bitcoin Reserve, as CoinGape reported, raising hopes that India may follow other world powers’ example.
A recent CCN story claims the Indian government intended to postpone rapid crypto legislation.
The country has acknowledged that cryptocurrency assets are still unregulated and that, despite its high taxation, it hasn’t gathered any helpful information about the sector in the last five years.
In Crypto Race, Is India Falling Behind?
Significantly, many cryptocurrency businesses have moved their operations abroad due to the government’s lack of interest in the industry.
Additionally, investors are now more susceptible to theft and breaches due to the absence of defined crypto regulations.
Following a $230 million cyberattack in 2023, WazirX, the biggest cryptocurrency exchange in India, had to relocate to Singapore to undergo reorganization.
The $44 million theft that CoinDCX experienced last week was another big attack that rocked the the country’s cryptocurrency market.
Interestingly, Siddharth Sogani, CEO of blockchain analytics company Crebaco, has become increasingly concerned about India’s crypto regulatory environment, calling it a “bleak situation.”
He observed,
Countries like the U.S. are regulating left, right, and center—and Indians are left with frustration. It’s been over 10 years since I’ve been fighting for regulations. I submitted several documents and even visited the Parliament, but no luck. Finally, I gave up and moved my business overseas.
In conclusion, the crypto environment in the country is still unclear, and companies are choosing to operate abroad due to the government’s stringent tax laws and ambiguous regulations.
The country’s unwillingness to modify its regulations may further limit its potential in this quickly expanding industry as the global cryptocurrency market changes.
