Rise With Profit: Crypto Gains Tax, GST On Food Delivery, Cocoa Futures Hit Record | Podcast

This is the daily morning update from NDTV Profit. Here’s everything you need to know before you start your work day.

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A look overseas first—it was a strong day of trade on Wall Street a day before the outcome of the Federal Open Market Committee’s ongoing meeting. There’s wide anticipation that the policy rate will be cut by another 25 basis points. Overnight, the Nasdaq Composite rose another 1.2% to close at a fresh record. The S&P 500 climbed 0.4%, while the Dow ended lower by a quarter of a percent.

Meanwhile, it’s a mixed start to trade in the Asia Pacific region—two of the three early risers were trading positive, last I checked. The Kospi in South Korea was lower by 0.8% as political uncertainty continues there.

Chinese markets have seen quite a bit of chop and churn this week. The latest trigger was economic data, which pointed to continued weakness. The country’s industrial output rose slightly in November, while retail sales disappointed. But more importantly, despite statements of intent from policymakers in Beijing, no stimulus measures are apparent. That’s leading to the belief that the Chinese establishment will attempt to bolster consumption without pulling the trigger on fiscal stimulus.

In other international news, a judge ruled yesterday that Donald Trump's conviction for falsifying records to cover up a sex scandal should stand, rejecting the US president-elect's argument that a recent Supreme Court ruling nullified the verdict. That’s based on a Reuters report that quoted a court filing.

In Europe, the union is committing to build a €10.6 billion constellation of satellites that will provide the bloc with encrypted global internet connectivity in a bid to provide a homegrown alternative to Elon Musk’s Starlink. The EU signed contracts to begin work on IRIS2, a 290-satellite multi-orbital network slated to be fully operational by 2030 that can serve European governments and militaries, as well as private customers.

In news back home, India's merchandise trade deficit widened to a record high in November, led by a jump in gold imports. In absolute terms, the trade gap widened to $37.8 billion in November, compared to $27.1 billion in October. Exports in November fell by 4.9%, while imports rose 27%. The fall in petroleum prices are seen to have impacted the value of India’s exports.

There’s an important legal case that I’d like to draw your attention to. It turns out that profits derived from the sale of cryptocurrency prior to April 1, 2022 will be taxable as capital gains. Taxpayers can also avail of exemptions under the IT Act against such profits. This is based on an order by the Income Tax Appellate Tribunal in Jodhpur, which ruled that Bitcoin, despite being a virtual asset, is still a capital asset, and therefore the gains from the sale of Bitcoin will be classified as capital gains and not 'income from other sources'.

Turning to other news, the GST Council is expected to address taxability issues related to food delivery services in its upcoming meeting on Dec. 21. The discussion will focus on platforms such as Swiggy and Zomato and the proposed Goods and Services Tax on delivery services provided by their partners. The Council could clarify on whether delivery services should attract a 5% GST without input tax credit, aligning with the rules for "restaurant services" that have been in effect since Jan. 1, 2022.

FMCG companies have more headaches ahead. Cocoa futures reached a fresh record in New York as the market grapples with renewed supply concerns, heightening the odds that the high costs already plaguing chocolatiers and consumers will worsen. Prices for the crop soared earlier this year as weak harvests in West Africa — the major production hub — plunged the world into a third straight supply deficit. After cooling, the rally recently regained momentum as adverse weather further threatens the region’s farms, limiting the chance to rebuild already low global stockpiles.

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