Taxing crypto doesn’t mean it is legalised: FM
Finance Minister Sitharaman
NEW DELHI: Finance minister Nirmala on Friday said the government has exercised its sovereign right to tax profits emanating from transactions in cryptocurrencies and the question of banning or not banning will be taken after inputs from consultations are finalised.
“I am not doing anything to legalise it or ban it or not legalise it, anything at this stage,” she told RS.
Sitharaman said, “Banning or not banning will come subsequently when the consultations give me inputs. But then would you rather have me not tax and allow the profits to be there and then tell me I have not even taken the corrective action? So legitimate or illegitimate is a different question. But I will tax because it is a sovereign right.”
She was replying to a question from Congress MP Chhaya Verma on the issue during the discussion on the Union Budget.
The FM’s response is a reiteration of the views she had expressed shortly after presenting the Budget on February 1. India had emerged as one of the few to tax digital assets such as cryptocurrencies and non-fungible tokens (NFTs) when Sitharaman announced a 30% tax on transfer of such assets in her Budget for 2022-23. The move has triggered a debate on the legality of such assets and whether taxes on them have legitimised them.
The Reserve Bank of India (RBI) governor on Thursday said private cryptocurrency currencies are a threat to the country’s macroeconomic and financial stability and undermine the central bank’s ability to deal with the two crucial issues and cautioned investors that they were investing at their own risk.
Sitharaman in her reply said the focus of the Budget in the midst of the pandemic is on “continuity, stability and sustainable recovery”. Countering the opposition’s charge on inflation, she said in spite of the supply-side disruptions, retail inflation now is at 6.2% compared to 9.1% during the UPA tenure. She, however, admitted that the government was aware it needs to do more at the ground level. The FM said the worst era of inflation that the country endured was from 2010 to 2014.
This content was originally published here.