Investors expect crypto tax to continue as Nirmala Sitharaman returns as finance minister

India concluded its general election on June 1, the results of which last week paved the way for the re-election of Narendra Modi as prime minister for a third consecutive term. As a member of Prime Minister Modi’s newly constituted cabinet, Nirmala Sitharaman has been reassigned as the country’s finance minister after first taking charge of the ministry in 2019. India’s crypto community has expressed mixed reactions to Sitharaman’s reappointment as finance minister.

Cryptocurrencies in India are under the control of the Ministry of Finance. Since 2022, all profits from crypto transactions in India are subject to 30% taxation, while a tax deducted at source (TDS) of 1% is applicable on the transfer of virtual digital assets (VDA).

Dilip Chenoy, the president of Bharat Web3 Association (BWA)congratulated the new government and said the Web3 advisory group would continue to work with officials to drive Web3’s growth.

“At BWA, we remain committed to collaborating with the government to drive the growth and development of the Web3 sector, with the aim of making India a global Web3 hub. We look forward to continuing our engagement and extending our support to the government for the development of forward-looking regulations that foster innovation while prioritizing consumer protection in the ever-evolving Web3 space,” wrote Chenoy on LinkedIn.

Indian crypto circle is waiting for FM Sitharaman to review the tax laws imposed on the crypto industry. Despite the outcryThe finance minister did not announce any tax relief for the crypto sector when presenting the interim annual budget earlier this year.

His reappointment as finance minister has sparked concerns among India’s cryptocurrency community, who fear that no tax reforms are in the works for the digital assets sector. Many took to social media to express their thoughts on the development.

FM Sitharaman is expected to present the full budget for the financial year 2024-25 next month. Crypto commentators expect the Finance Minister to reduce the 1% TDS cut on every crypto transaction to 0.01% as part of her upcoming budget presentation.

In March this year, Sitharaman had said that India did not consider any cryptocurrency as a “currency” option. At the time, Sitharaman said that “assets created in the name of crypto can be assets for trading, assets for making money, and assets for many other things.”

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