Crypto players seek clarity on taxes and regulation from Sitharaman's Budget

economictimes.indiatimes.com:

Nirmala Sitharaman, who will table the Union Budget on February 1. Currently, there is no legislation, act or law to govern, regulate or prohibit dealing in crypto assets in India. Therefore, it is not illegal to sell, purchase, deal or mine cryptocurrencies or set up a cryptocurrency exchange in the country. However, the demands from the industry players, investors and other stakeholders are likely to reach the government, who may finally give heed to clear the clouds of ambiguity and may steer to the way ahead for the future.

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Earlier it was speculated that a Bill would be introduced in the winter session of Parliament to ban or regulate the crypto assets. However, the same was not introduced, and now, all eyes are on the first day of the next month. The first and foremost expectation from the Budget would be to get some clarity on the legal characterisation of cryptocurrencies for tax purposes. Tax treatment of cryptos under income tax and GST will significantly vary depending on whether cryptocurrencies are treated as commodity, service, security, asset or currency, said Purushottam Anand, Founder, Crypto Legal. «Most of the uncertainties relating to tax treatment will be resolved once cryptocurrencies are defined in law to end any speculations regarding its legal character,» he added. Also, GST will clarify whether the sale of the crypto property will be treated as goods or intangible assets or sale of proprietary property or services to attract 18 per cent GST. The intention of the government to regularize and monitor, if not a blanket