Here’s why India held on to older crypto reforms in national budget 2023

India's union budget for the year 2023 mentions Cryptocurrency and blockchain technology, bringing down the hopes of millions of crypto holders in the country. Many in the Indian crypto community were hoping for some reduction to the high crypto tax.

Here’s why India held on to older crypto reforms in national budget 2023

The Indian government needs more information and time to decide on rigid tax policies given it has been only ten months since the tax laws were introduced in March 2022.

Indian Finance Minister Nirmala Sitharaman announced key changes to the income tax slabs in the Union budget session. Nirmala Sitharaman didn't mention crypto, central bank digital currency, or blockchain tech. India levied a 30% tax on crypto profits and a 1% tax deducted at source (TDS) on all crypto transactions. 

The primary motive for introducing a TDS on the crypto transaction was to determine the total number of Indian citizens actively using cryptocurrencies. this data will be made available to the government as Indians file income tax returns from May 2023

Subhash Chandra Garg a former finance secretary of India stated that crypto taxes need much more clarity he added "we might not see any new changes in the upcoming budget 2023" also reveal served as the chairman of the committee that drafted the first crypto bill. 

Pushpendra Singh a tech entrepreneur and a blockchain influencer believes the government is still waiting on the report from the committee it had formed earlier and said: 

"The finance minister has not express anything related to crypto tax because the government is waiting for the committee reports as per my understanding the indian government has made one committee to study crypto."

Sathvik Vishwanath and co-founder and CEO of Indian exchange Unocoin said that new income tax laws for crypto were triggered only 10 months ago, TDS is being applied only for seven months, and the government needed more time.

"The indian government needs to have enough data for an extended period of time say 1-3 full financial years to analyze and make amendments as necessary hence no significant news was expected on the crypto industry anyway. we may expect some amendments in due course or during the next budget."

Another factor for the absence of crypto in the union budget could be India's focus on taking a global approach to crypto regulations, especially a common taxonomy in July 2022 the finance minister sought an international collaboration from G20 members to bring a common standard for the crypto global level.

Related: India should introduce ‘more principle-based’ legal framework for digital currency