Many crypto investors, entrepreneurs, and traders cheered as India‘s Budget finally solved the mystery of how digital assets – such as crypto – would be taxed. However, it’s a mistake to assume that everyone is throwing confetti around. In fact, thousands are fuming.
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A 30% tax on the transfer of digital assets – it’s apparently not as simple as it sounds, since a petition against the move started just hours ago had over 27,000 signatures by the time this article was written. The petition’s creator Aditya Singh asked the Government of India to “Introduce Reasonable Crypto Tax Policies.”
The petitioners objected to the way the Indian administration was reportedly treating crypto on par with gambling. In fact, the petition had five demands for change. These included not treating crypto trading as a form of gambling, changing the 30% tax rate to comply with stock market transaction tax rates instead, reducing the tax deducted at source [TDS] from 1% to 0.05%, expanding the scope for defining “cost of acquisition,” and allowing losses to be set-off or carried forward.
The petition further stated,
“The Proposals put forth by the Honorable Finance Minister in Budget 2022 placed crypto at the same footing against social evils like Betting and gambling. This can have a devastating impact not only on the Industry per se but the economy as a whole.”
What’s more, supporters have taken the hashtag – #ReduceCryptoTax – to Twitter, where it quickly went viral.
What do you “meme” by this?
Needless to say, Twitter’s meme makers had a field day, as they used the hashtag to comment on the proposed tax policy or express their own woes.
— Vikram Singh (@VikramS22672779) February 3, 2022
Meanwhile, others objected to the way the government viewed crypto trading.
I don't think imposing 30% tax on crypto is a right decision,There is a 15% tax on stocks and 30% on crypto!
If you think crypto is gambling, then what is the stock market🤔
bhikh mangni hai to hanth main katora le lo.@nsitharaman @PMOIndia @narendramodi
— vishal dwivedi (@Dwivedi98Vishal) February 3, 2022
It’s important to note that in an interview with Bloomberg, India’s Finance Secretary T.V. Somanathan compared crypto assets to winnings from bets or horse races. As one might expect, Indian crypto traders aren’t at all happy with the implications of this. For his part, Singh called on industry stakeholders to speak up for reduced crypto taxes.
In response, one individual who praised the petition was Nischal Shetty, the CEO of the Binance-owned WazirX crypto exchange.
Appreciate this initiative @CryptooAdy
Hope to see everyone join in
— Nischal (WazirX) ⚡️ (@NischalShetty) February 3, 2022
An exchange of views?
All said and done, the unveiling of a crypto tax framework may not have been a complete bane for the industry. Several Indian crypto exchanges reportedly noted a spike in user sign-ups a day after the Budget announcement.
While thousands of traders are against the proposed tax policy, others are just relieved that India did not go down the China route and announce a blanket ban.