Indian Regulators Say Cryptocurrency Is Not Illegal And Now Taxed As Gambling Profits

Arman Shirinyan

Indian Regulators Compare Profits From Cryptocurrency Trading To Gambling

The Indian regulators have stated that they will not treat cryptocurrency trading as an illegal activity a day after the announcement of a special tax regime for crypto-related transactions that will be treated the same as winnings from gambling.

According to the regulator, cryptocurrencies remain in the “grey area”, and therefore it is not illegal to buy and sell cryptocurrencies or other digital assets, according to Finance Minister TV Somanathan.

The framework for cryptocurrency payments and transactions will be similar to the tax regime for horse racing profits or from betting and other speculative transactions.

After years of consideration and discussion, the government budget has proposed taxing income from virtual asset transfers at 30%, effectively moving cryptocurrencies into a “brighter” tax framework.

Previously, India’s central bank has released numerous warnings about the risks associated with the cryptocurrency industry, including money laundering, financing of illegal activities and market volatility spikes. The Indian cabinet has yet to approve the bill before it is sent to lawmakers.

The government has not yet stopped the development of the regulatory framework surrounding the industry. Regulators are still going to discuss the status of digital assets while comparing the regulatory experience in other countries.

For now, the government will tax all transactions held in citizens’ accounts while a more in-depth tax framework is developed.

Earlier, the Indian government announced its first digital asset tax plan, which includes a tax on digital asset transfer revenues at a rate of 30% and no expense allowance.

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