The proposed Indian tax rate for income from virtual assets would be high, however, it indicates that India recognizes its cryptocurrency industry. This was stated by the head of the top crypto exchange, CNBC.

Nirmala Sitharaman, the Finance Minister noted that in the February 1st annual budget her speechThe “phenomenal rise in digital asset transactions” The 30% tax she proposed on income from digital asset transfers would apply to all income. She also stated that no deductions would allow. These losses cannot be offset against other income.

India also planned to apply a 1% TDS (tax deducted at source) on all payments related to digital asset transfers.

CNBC’s Ashish Singhal was the founder and CEO at CoinSwitch. He said that the 30% tax was too high. However, he said that it was still a positive decision because it removed some of the uncertainty surrounding the Indian government’s position on crypto in the recent months.

Singhal stated that this signal is government recognition of the industry. “Hopefully the cryptocurrency bill would address legality of the ecosystem too.” Singhal spoke on “Street Signs Asia.”

He explained that the Blockchain and Crypto Assets Council — the industry body in India — would aim to work with the authorities to make the tax for crypto earnings on par with other asset classes over time.

In November last year, parliamentary bulletinIt was indicated that the government would be introducing a new bill to regulate digital currency. According to the bulletin, India wanted to ban all private cryptocurrency and create a system for central banks issuing official digital currencies.

Seit damals local media reports have saidThe Indian government could decide to regulate crypto instead of banning it all.

This bill is not yet in place. According to the report, it was not included in any proposed legislation which may be brought before Parliament during the current session. media reports.

Singhal acknowledged that digital assets would be taxed as per the proposal, however noted that some people may not see them as “quick-rich” schemes and the rate will likely discourage many users.

He stated that “the government did very well to seperate the crypto currency use case from the crypto asset use case,” and added that the Reserve Bank of India would handle the latter.

“And then they recognized crypto assets in themselves as an asset class. Singhal stated that this is an important step in legitimizing crypto assets as an asset class, and the crypto investment case.

Sitharaman suggested in her budget speech that the central bank will begin issuing digital rupees using blockchain and other technology, starting April 1st.

India could be next to adopt the so-called central banking digital currencies trend. CBDCs, which are digital legal tender, are basically the online versions of fiat currencies.

Sitharaman stated that the digital rupee will “give a huge boost to digital economy.” He also said, “Digital currency” will make it easier and more affordable to manage currencies.

RBI Governor Shaktikanta Das told CNBCLast year, the central bank studied various aspects regarding a digital currency. These included its security, potential impact on India’s financial system and how this would affect monetary policy.