Bharat Web3 Association seeks reduction of high tax rates

w3badmin

December 6, 2022

Source: news.google.com

Bharat Web3 Association seeks reduction of high tax rates Commuters walk past the Indian Ministry of Finance building at sunset in New Delhi, India. Image: Adnan Abidi/ Reuters

The Bharat Web3 Association (BWA), a well-known Indian cryptocurrency advocacy group, has submitted a draft to the Indian Ministry of Finance expressing its concerns and recommendations regarding high taxes and regulatory uncertainty in regards to crypto assets in India.

The BWA has called on the ministry to provide adequate tax relief in the next budget along with a policy change that does not allow loss-versus-profit offsetting and a 1 per cent TDS policy change.

BWA was formed last month after IAMAI dissolved BACC in July, with most BACC members including WazirX, Coinbase, CoinSwitch Kuber, CoinDCX, and Polygon among others joining BWA.

The Finance Ministry is consulting with various industry bodies in India ahead of the next budget for 2023-24 in February. In the 2022-23 budget, the Ministry of Finance introduced a 30 percent capital gains tax and a 1 percent transaction tax at source (TDS) deduction. The ministry added that profits made on crypto transactions cannot be transferred or offset against losses.

Members of the cryptocurrency advocacy group are expected to meet with Finance Ministry officials next week. The group has noted that tight and hostile tax policies are hurting the growth of crypto assets in India, and reform is necessary.

Crypto industry representatives have been calling for the TDS rate to be lowered to 0.1 percent. This is because although TDS returns can be claimed, having your capital locked up is not very profitable for traders.

“The BWA aims to highlight the impact of existing tax provisions such as TDS, VDA income tax, and non-loss pass-through on industry at large and share their input on suitable amendments that can help address government concerns. and at the same time allow the growth of this sector,” a BWA member told Business Standard.

The Indian crypto industry saw a 90 percent drop in trading volume, largely due to these strict rules and regulations.

In view of the FTX crisis, BWA also recommended the Ministry of Finance to propose a set of strict regulations for the cryptocurrency sector. BWA said it is in constant contact with the government to ensure a strong compliance and regulatory framework is in place.

The writer is the founder of yMedia. He ventured into crypto in 2013 and is an ETH maximalist. Twitter: @bhardwajshash

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