digital assets tax: Govt pushes changes in finance bill to clear air on taxation for digital assets

Synopsis

The finance bill is scheduled to be taken up in the lower house for discussion and consideration on Thursday. It would be likely taken up for passage on Friday.

The government has moved around 39 changes to the finance bill including some aimed at further tightening the proposed taxation regime for crypto assets.

The finance bill is scheduled to be taken up in the lower house for discussion and consideration on Thursday. It would be likely taken up for passage on Friday.

Union finance minister Nirmala Sitharaman will move an amendment to make it clear that no tax deduction or set off would be available in lieu of mining costs of cryptocurrencies and other virtual digital assets (VDAs) or losses from their transfer.
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The amendment is in line with the clarification given by minister of state for finance Pankaj Chaudhary on Monday in response to a question in the Lok Sabha.

The government will also move an amendment to say all transfers of virtual digital assets will be covered under the proposed 30% tax irrespective of whether they were a capital asset or not. It will also move an amendment to explicitly state that only the proposed rate of tax deducted at source on virtual digital assets transactions would be applicable and not rate applicable under any other provision.

The 2022-23 Budget had proposed levying income-tax of 30% on crypto assets with effect from April 1.
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Updated: 03/24/2022 — 05:00