Recently, in the budget 2022-23 the Finance Minister of India Nirmala Sitharaman introduced a special tax regime for the Virtual Digital Assets (VDAs) commonly known as crypto-assets that has been implemented from April 1.
There are almost 10 million crypto-asset owner in the country and the number is rising every single day. On the other hand trading in crypto-assets is speculative and it is way more volatile. But the trading can not be prohibited. That is why there is a need to regulate the trade process. There are many cryptocurrency exchanges that operates in India, some of the name includes CoinSwitch Kuber, Zebpay, WazirX and CoinDCX.
The new tax regime 2022 looks upon the incomes accruing from the transfer of VDAs because the incomes derived from the trading of cryptoassets have already been taxed under the provision of Income Tax Act, 1961.
Virtual Digital Assets can be defined as a code, information or token generated through the cryptogenic means or providing a digital representation of value that is exchanged with or without consideration.
Under the new tax regime any transfer of VDAs will be taxed at a flat rate 30% and there will be no deduction allowed for any expense other than the purchase price of the concerned VDA.