India plans on taxing crypto investors as of late due to the skyrocketing price of Bitcoin as we are reading more in today’s BTC price news.
Indian traders could be required soon to pay taxes on crypto gains since the tax authority of the country is in possession of the investors’ data. About ten months after the Indian Supreme Court lifted the ban on crypto transactions, new reports show that the country’s tax authority is watching closely on the crypto traders as the Bitcoin price continues its bullish trend. According to local media, the Indian Tax Department is already in possession of the data belonging to investors that invested in BTC or crypto before the RBI ban in 2018.
The developments came after the data showed a huge increase in crypto trading activities in the country. Since the crypto ban was lifted, retail investors starting from the age of 25 to 40, were spending millions of dollars on trading every day. Two of the biggest platforms in India, WazirX and CoinDCX, saw a huge increase in activity over the past six months. According to new reports, WazirX recorded a huge increase of 125% in user signups and a daily trading volume of $19-26 million.
As India plans on Taxing crypto investors, some experts believe that this is going to be a difficult task because there’s no regulation for crypto dealings. Experts think that a regulatory framework will provide more clarity and will make the entire process easier. While the country is yet to release a new draft on crypto regulation, the reports show that India could regulate crypto assets as commodities.
It’s unclear how India plans to implement the tax laws but sources say that the country’s taxation agency is preparing to collect tax on the gains made from BTC. Experts think that the tax authorities have to classify crypto gains as business income and investors will have to pay up to 30% on profits made by selling crypto. However, some tax experts advised their clients to declare their BTC earnings as capital gains which is much similar to the profits generated from shares.
As recently reported, India’s first BTC exchange BuyUCoin pushed for a regulatory sandbox in India as the draft for the proposed sandbox demanded a taxation framework for crypto assets. It also proposed an open platform that will merge the data from the exchange and channel it to Indian regulators by using APIs. The regulators in India mull in the new Bitcoin Ban as BuyUCoin industry leaders have come together to propose an alternative.
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