The head of the Central Board of Direct Taxes (CBDT) in India said the 30% tax on crypto holdings doesn’t make crypto trading legal in India.
On Tuesday, the finance minister of India announced a 30% tax on crypto holdings during the budget session. The announcement aroused a debate about how “India legalizes crypto.” But, CBDT chief J.B. Mohapatra made it clear that there are misconceptions surrounding the matter.
Mohapatra said that the newly announced crypto tax would allow the tax department to calculate the depth of the cryptocurrency market in India. He added that imposing a tax on the growing crypto market doesn’t mean that it’s legal to trade digital coins in the country.
“The crypto trade or the digital assets transactions do not ipso facto become legal or regular just because you have paid taxes on that.”
The chief of the tax department also said that legalizing cryptocurrencies will be determined according to how clean the national framework will be, after introducing it to the parliament. Nonetheless, he explained that this would allow the country to track and curb illegal activities related to cryptocurrencies such as money laundering and funding terrorism. Mohapatra added that regulating the market makes it possible to track what’s going in and outside the cryptos ecosystem.
