India’s cryptocurrency trading scene has taken a hit due to the high tax rates, making it difficult for traders to turn a profit.
The presence of crypto exchanges and trading operations seems to be of little use, as India’s tax authorities have collected a significant sum of $19 million from crypto asset transfers over a nearly full fiscal year, according to Finance Ministry spokesman Pankaj Chaudhary.
The Indian government has introduced a new tax regime for cryptocurrency transfers during the fiscal year 2022/2023, which came to an end on March 31st.
The new tax levies a 1% charge on all transactions over Rs 10,000 (approximately $125), and came into effect on July 1st, 2022.
In November, the finance minister revealed that the new tax had already raised Rs 604.6 million (about $7.4 million).
Despite requests from industry representatives for a cut in tax rates to 0.05-0.1%, the authorities have yet to make any concessions.
With low tax collection, it was expected that the government would reduce the rates, but that has not yet happened.
India’s Minister of Finance has previously stated that the G20 countries are discussing the possibility of joint regulation of the crypto industry, further highlighting the importance of the global discussion around cryptocurrency regulation.