Reason for high taxation on Crypto income

  Tax on Crypto income

During the recent budget it was proposed that a flat 30% tax will be imposed on all income generated through the transactions of virtual digital asset which include crypto currencies.

They have decided for this high tax to keep small investors away and protect them from the volatility of this market which is of very high risk. Budget also says that any losses on a crypto transactions cannot be offset against the profit to claim tax reductions. This feature is however is offered when you suffer losses in your investment in stock market. Then it also propose a TDS of 1% on all the crypto transactions so that the transactions can be captured at the source itself which will help the tax authorities to monitor tax compliance in this regard. The budget also made it very clear that crypto currency will never be adopted as legal tender. Instead the government has proposed a introduction of digital rupee based on block chain technology and this will be issued and maintained by central Bank and such a central Bank digital currency is expected to bring efficiency into India's digital economy.