Union Finance Minister Nirmala Sitharaman has announced the launch of digital currency in the country by RBI in 2022-2023. The digital currency to be launched will be backed by blockchain technology, stated the Finance Minister during the course of her Budget 2022 speech.
The Finance Minister also announced that income from the transfer of digital assets would be taxed at 30%. A TDS of 1% will be levied for transactions above a certain threshold.
Until now, there wasn’t any provision for taxes on profits received on transfer of digital assets, including NFTs, cryptocurrencies based-digital tokens.
Crypto/virtual digital asset gifts will be taxed in the hands of the recipient. No set-off facility will be available in case of losses from investment in these virtual assets.
As per reports, RBI’s Central Bank Digital Currency is likely to be introduced in the government’s upcoming bill of regulating cryptocurrency assets in the Winter session of the Parliament.
The FM acknowledged that a CBDC will help in the cheaper management of currency and boost the overall economy. The introduction of digital currencies will also enhance India's status as a digital economy.
WazirX Co-Founder Nishchal Shetty applauded the move by the government on launching cryptocurrencies through a tweet, “Blockchain-powered Digital Rupee by RBI will be introduced 2022-23 in India. Great news! More crypto adoption is on the way. Glad to know that RBI will now start getting deeper into crypto. Hope to see banks start getting involved with the crypto industry as well.”
Blockchain powered Digital Rupee by @RBI will be introduced 2022-23 in India— Nischal (WazirX) ⚡️ (@NischalShetty) February 1, 2022
Great news! More crypto adoption on the way ????
Glad to know that RBI will now start getting deeper into crypto. Hope to see banks start getting involved with crypto industry as well#IndiaWantsCrypto
The current existing cryptocurrencies, like Bitcoin, have been a point of concern for the RBI as these are not regulated by SEBI or RBI in the country.