Although cryptocurrency is not officially accepted, India has a policy in place for transactions involving cryptocurrency. At the start of 2022, the government introduced a 30% tax on capital gains from cryptocurrency. Additionally, a 1% tax is deducted at the source by law for every transaction. GST is charged on the services provided by cryptocurrency exchanges.
Additionally, these taxes should not be considered as formal government approval. India has not officially stated whether cryptocurrencies are legal or not. Though the sector falls under money laundering rules, they don’t include any special regulations just for it.
The government has released a paper to describe its approach to regulating cryptocurrency. Officials from the RBI, SEBI, and the Ministry of Finance have collaborated to review guidelines from other countries and develop their domestic policies. Upon finishing, everybody is encouraged to contribute their point of view during the public consultation process.
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