Budget 2021: Amend Income Tax, GST Laws To Accommodate Crypto Trading, Say Experts

Budget 2021: Considering the ambiguity among investors pertaining to the tax applicability for the income earned from crypto trading, the upcoming budget should bring in amendments in the Income (I-T) Tax and GST laws to offer more clarity to investors, traders, and crypto organizations, stated Mr Sumit Gupta, CEO, and Co-Founder, CoinDCX, one of the country's largest cryptocurrency exchange. In order to tackle anti-money laundering or AML and other funding concerns, the government should consider a formal direction to exchanges to follow the virtual assets guidelines of the financial action task force (FATF), he explained. 

As several companies related to cryptocurrency are setting up base in the country, the crypto industry seeks foundation and recognition. A proper recognition can accelerate its contribution to the gross domestic product (GDP) as well as the rate of employment. It may create a trust factor among retail investors and institutional players. Mr Gupta added that recognising crypto as a tradable commodity will be a significant relief.

Cryptocurrency has been emerging as one of the fastest-growing digital assets across the world it has witnessed steady traction in India after the Supreme Court lifted the banking ban. It has also generated massive interest from investors in the country.

Meanwhile, yesterday on January 21, cryptocurrency bitcoin slipped 10 per cent, to a 10-day low, retreating further from its peak record highs, as traders expressed concerns of tighter US regulation. The world's most popular cryptocurrency was last up 4.14 per cent at $32,439.6. Bitcoin lost nearly a quarter since achieving a record $42,000 on January 8, 2021 continuing its broader bull run. the bull run was witnessed since October 2020 as investors' sentiment weighed in on the virtual currency's inflation hedging qualities and potential for quick gains.