Union Budget 2022:Crypto industry waiting the passing of the Crypto Currency Bill

The entire crypto industry has been awaiting the passing of the Crypto Currency Bill by the Parliament. As per estimate, India has now about 20 million investors with an investment estimated at $10 billion. With such huge investment at stake, the government needs to provide for taxability of gains arising from crypto investment.With no specific provisions for cryptocurrency, there are various ambiguities with regard to taxability of such gains derived from the same. For instance, whether the gains would be treated as in the nature of capital gains or Income from Other Sources or Income from Business. Further, there is no clarity on the applicable tax rates or even the methodology of classification of crypto assets into long term or short term,taxation of mined cryptos, disclosure requirements, etc. There is also no clarity on the applicability of GST on such transactions. Thus, in order to remove such ambiguities and avoid litigation in future, there is a need for specific provisions for taxation of crypto transactions. This would also result in additional revenue as taxpayers can report such transactions without fear of additional tax exposure.