The union government has been keen on introducing a cryptocurrency regulation, or a bill, but further delay is expected as the upcoming budget session of parliament that commences on January 31 is unlikely to offer any immediate regulatory relief to investors or other industry stakeholders.
A recent report reveals that the parliament intends to buy itself more time to hold more discussions and build consent on the regulatory framework. However, there are few things to be expected from the government related to crypto regulations.
Crypto industry insiders, investors, and traders are expecting the introduction of a proper tax policy framework for crypto earnings in the upcoming Union Budget 2022 although that is likely to form only a portion of the eventual bill.
The government can introduce a higher tax rate for gains made by an individual or entity from cryptocurrency trading too. The tax rate here can be 30 percent, which is similar for gains made from a lottery, game shows, puzzles, etc.
The government and other stakeholders might opt to functionally categorise different cryptocurrency businesses — exchanges, wallet token issuers — and impose varying tax responsibilities on them.
The government is trying to buy more time because of the Reserve Bank of India's plan to launch a central bank digital currency (CBDC). The Reserve Bank of India had decided to pilot a simpler CBDC model and to utilise the lessons from the pilot in creating a more sophisticated CBDC.
