Latest news with #VDA
Time of India
2 days ago
- Business
- Time of India
Crypto regulation in India: CBDT asks stakeholders on regulation, compliance; VDA oversight, tax-compliance in focus
Representative AI-image Apex taxation authority has inquired with cryptocurrency stakeholders about the necessity of new virtual digital assets (VDA) legislation, its administrative oversight, and the impact of current tax policies on trade migration. The Central Board of Direct Taxes (CBDT) has also sought feedback regarding the 1% tax-deducted-at-source (TDS) rate, potential adjustments, and the possibility of loss offsetting for traders, as reported by Economic times report. These comprehensive inquiries have raised optimism within the cryptocurrency sector, which has faced challenges from stringent taxation, regulatory uncertainty, and the Reserve Bank of India 's cautious stance towards cryptocurrencies. Currently, cryptocurrency profits face a 30% tax rate, unlike the lower capital gains tax applicable to equities. Traders cannot balance profits against losses for tax reduction. Many traditional banks hesitate to facilitate crypto transactions due to central bank concerns. Additionally, regulations under RBI and FEMA lack clarity regarding residents' participation in overseas cryptocurrency platforms. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Your Finger Shape Says a Lot About Your Personality, Read Now Tips and Tricks Undo These regulatory constraints have prompted numerous significant crypto investors to relocate their operations to Dubai, which aims to establish itself as a global cryptocurrency hub India might revise its approach, considering cryptocurrency adoption in developed markets and digital currencies' emergence as investment vehicles and underlying assets for US mutual funds. "Considering the G20 Synthesis Paper, Finance Track Communique, and the recent Parliamentary Standing Committee on Finance announcement selecting VDAs for a detailed examination this year, it is likely that the government will introduce a comprehensive VDA regulation. India has consistently emphasised that regulation or banning can be effective only with significant international collaboration," said Purushottam Anand, advocate and founder of Crypto Legal, a blockchain and crypto-focused law firm, quoted by ET. With China remaining the sole major economy enforcing a complete prohibition, global consensus favours regulation over prohibition, according to Anand. Queries by CBDT CBDT's data analytics cell requested platforms to submit their perspectives by mid-August. Accordin to ET, the specific queries included: (a) Do you think the current VDA regulation in India is adequate or a comprehensive VDA law is required and the agency which you consider should be authorised to administer it (e.g, Sebi, RBI, MeitY, FIU-IND)? (b) What percentage of trading volumes has moved offshore, and under what circumstances (eg tax concerns, regulation, liquidity)? Which are the jurisdictions where users/businesses are shifting? (c) How would you compare India's VDA tax framework with major jurisdictions? (d) Have you observed any market impact due to the disallowance of loss set-off or carry-forward? In your view, how has the 30% flat tax affected volumes, liquidity etc? (e) What is the biggest challenge in implementing the TDS-identifying counterparty's residency status, calculating the market value of VDA, handling peer-to-peer transactions, or reporting to the income tax department's centralised processing centre? (f) Should there be different TDS treatment for market makers, or retail or institutional transactions? (g) What measures could be considered to ensure a level playing field between domestic and offshore VDA exchanges, particularly in relation to tax compliance for Indian customers? Some exchanges, within the past two years, have introduced derivative products like crypto futures and options with reduced TDS impact. CBDT seeks clarification regarding derivatives, cross-border transactions, and VDA definition. Platforms must also address their readiness for OECD's crypto-asset reporting framework (CARF), designed to combat tax evasion and money-laundering. Stay informed with the latest business news, updates on bank holidays , public holidays , current gold rate and silver price .
Economic Times
2 days ago
- Business
- Economic Times
Taxman eyes crypto code; China stalls India tech JVs
We've got fresh details on India's crypto regulation push, plus a look at China's tech deal delays. This and more in today's ETtech Top 5. Also in the letter: ■ Data centre certification push■ Festivities to fuel lending■ Google's Australia blow Taxman floats crypto code, quizzes industry India's top tax authority is testing the waters for a new legal framework for virtual digital assets (VDAs), raising the prospect of a reset in how crypto is regulated and taxed. State of play: The Central Board of Direct Taxes (CBDT) has sent a detailed questionnaire to crypto platforms. It asks whether India needs a comprehensive VDA law, which agency—Sebi (Securities and Exchange Board of India), RBI (Reserve Bank of India), MeitY (Ministry of Electronics and Information Technology) or FIU-IND (Financial Intelligence Unit - India)—should oversee it, and how current tax rules are shaping trade. Crypto players were also asked if the 1% TDS (tax deducted at source) on every sale is excessive, what an equitable rate would be, and whether traders should be allowed to set off losses against profits. Other questions covered offshore migration of trading volumes, derivatives clarity, and readiness for the OECD's crypto-asset reporting framework. Zoom out: India currently taxes crypto gains at 30% and disallows loss offsets, unlike stocks. Many traders and platforms have shifted to Dubai, where policy is friendlier. The big picture: Advocates say India may introduce a comprehensive VDA law this year, aligning with G20 commitments. The global trend is toward regulation, not prohibition with China the lone exception. Also Read: Perplexity offers users free access to Indian stock market and crypto data Beijing drags its feet on tech deals, holding back Indian JV plans As Prime Minister Narendra Modi prepares to visit China for the first time in seven years, Indian companies are struggling with delays in securing approvals for technology partnerships. Driving the news: Chinese authorities are taking longer to clear deals involving technology transfer, even when commercial terms are agreed. Haier's plan to sell up to 50% of its India business to Bharti Group is delayed over the approval of transfer conditions. PG Electroplast's compressor joint venture with China's Highly Group is also stuck, pushing timelines for its new plant. Why it matters: Indian electronics and auto parts makers rely heavily on Chinese technology. Delays could slow capex plans and dent India's ambitions in EV and consumer durables manufacturing. Between the lines: Industry insiders say Beijing has issued 'verbal instructions' to scrutinise technology-transfer deals, especially in electric vehicles, to protect its lead. What's next: Analysts say China is treating tech with the same strategic lens it applies to rare earths. India, meanwhile, continues to vet Chinese investments under Press Note 3. Modi's trip is expected to include trade talks on rare earths and critical inputs, but frictions remain. AI moats and market makers: The ultimate soonicorn playbook drops in five days Description: ET Soonicorns Summit 2025 is bringing India's most ambitious AI and startup conversation to Bengaluru: From Research Labs to Revenue Models—The Billion-Dollar Blueprint for Scaling Indian AI Startups. Power sessions: From the horse's mouth! Know how to build an Indigenous Tech Stack in the AI Age with Mohit Saxena, the man who founded a unicorn when unicorns barely existed. This fireside chat features the Co-founder and CTO of InMobi and Glance, in conversation with Deepak Ajwani, Editor, Unravelling AI Moats for Market Leadership! An AI-focused panel featuring unicorn founders Piyush Shah, President & COO, Glance and Co-founder, InMobi, and Saahil Goel, Managing Director & CEO, Shiprocket. The grand finale fireside chat—'The Mindset of Market Makers: Lessons from Building India's First Scaled Meat Brand'. Listen to Samidha Sharma, Editor, ETTech, in conversation with Abhay Hanjura and Vivek Gupta, Founders of Licious, on leadership lessons from the trenches. What are you waiting for then? Register now before the seats are filled! Govt pushes ahead with national data centre certification The Indian government is pressing ahead with plans to roll out a national certification framework for data centres, despite industry concerns over duplication with global standards. Driving the news: Officials told ET that the Ministry of Electronics and IT (MeitY), along with Trai, TEC, and BIS, are working to establish India-specific norms for construction, operations, and security of data centres. The Standardisation Testing and Quality Certification (STQC) directorate is drafting the certification scheme, covering land use, power consumption, and security measures. Back in 2022, Trai had already recommended national-level standards, pushing BIS, TEC, and STQC to collaborate. Why it matters: Data centres are becoming critical infrastructure for AI, fintech, and cloud services. Officials argue national standards are essential for security and resilience. Between the lines: Industry players question the need for India-specific certification when international frameworks already exist. They worry that additional compliance could raise costs and slow rollout. What's next: The government is likely to finalise guidelines this fiscal. MeitY and other agencies see certification as a foundation for attracting investment, even as companies lobby for lighter-touch norms. Fintechs bet on festive revival of unsecured lending after slowdown After a year-long regulatory squeeze, fintechs and NBFCs are preparing for a rebound in unsecured lending, with the festive season expected to spark fresh demand. State of play: RBI's 2023 move to raise risk weights on unsecured loans forced banks and NBFCs to tighten credit, hitting fintechs dependent on consumer and merchant loans. BharatPe is scaling consumer lending through its NBFC, Trillionloans, and says it is ready to ramp up disbursals during festivals. Paytm reported strong Q1 growth in its lending business and expects more monetisation over the next 6–12 months. NBFCs such as L&T Finance and Poonawalla Fincorp are also seeing recovery signs in microfinance and unsecured segments. Zoom out: Credit rating agency Icra projects Rs 19–20.5 lakh crore in incremental credit expansion this fiscal, up 10.8% year-on-year. Fintechs are eyeing a significant share. The big picture: Executives believe the worst of the stress is over but caution that recovery will be gradual. Rate cuts will take time to flow through, and lenders remain wary. H2 FY26, especially Q4, is expected to be strong. Festive spending will be a critical test of whether the unsecured lending cycle has truly turned. Google slapped with $36 million fine in Australia Google has agreed to pay AU$55 million ($36 million) after Australia's competition regulator accused it of signing anticompetitive deals with Telstra and Optus. Driving the news: The deals, in place from late 2019 to March 2021, required the telcos to exclusively pre-install Google Search on Android devices, shutting out rivals. In exchange, Telstra and Optus got a share of Google's ad revenues. Regulators said the contracts 'substantially lessened competition,' reducing consumer choice. Google admitted the agreements were anticompetitive and pledged to adjust its contracts. Why it matters: The ruling highlights how Big Tech leverages default settings to cement dominance — an issue under scrutiny globally, including in the US and EU. Also Read: Meta says will appeal 'unlawful' EU fine Between the lines: The fine comes as AI-driven search reshapes competition. Regulators argue that limiting search options at a time of disruption could stifle innovation. Also Read: Apple takes fight against $587 million EU antitrust fine to court What's next: Google must comply with enforceable undertakings to remove restrictions from contracts with telcos and device makers. The case sets a precedent for how regulators may treat similar deals in other markets. Recent Big tech fines: The European Commission recently imposed fines under the Digital Markets Act earlier this year: €500 million on Apple for preventing app developers from steering users to cheaper options outside the App Store, and €200 million on Meta for forcing users to choose between personalized ads or paying for ad-free access. Both companies are challenging the rulings. Updated On Aug 18, 2025, 07:29 PM IST
Japan Times
3 days ago
- Automotive
- Japan Times
Trade partners grow restless waiting for Trump's tariff breaks
U.K. Prime Minister Keir Starmer declared at a Jaguar Land Rover factory in May that his world-leading trade deal with U.S. President Donald Trump included a cut in U.S. tariffs on British steel to zero. More than three months later, steel lobbyist Peter Brennan is still waiting for that relief to become reality. Brennan, director of trade and economic policy at industry body U.K. Steel, said most members had seen U.S. orders fall because of the uncertainty over America's 25% import tax. One producer that makes particularly price-competitive products said they'd be out of business by year-end if tariffs aren't reduced to zero, he added. "Concern is growing that finalizing the deal on steel has fallen down the priority list both for the U.K. and U.S. governments,' Brennan said last week. "The will to close the deal may well be faltering on both sides.' Frustration and economic losses like those in the U.K. are growing in Japan, the European Union and South Korea. Those three made similar announcements over the past month: that Washington granted them leniency on auto exports in the haggling over the level of Trump's across-the-board tariffs that took effect Aug. 7. But for the trio of car export powerhouses, which unlike the U.K. face a 50% duty on their steel and aluminum, the wait for Trump's concession continues while an American levy justified on national security grounds on imported Toyotas, BMWs, Hyundais and others remains at a crippling 25%. "We're continuing to see damage — the bleeding hasn't stopped,' Japan's chief trade negotiator, Ryosei Akazawa, said Friday in a reference to the country's car industry. "We want the U.S. to sign the executive order as soon as possible.' Spokesmen for the White House, the U.S. Trade Representative's office and the Commerce Department didn't reply to requests for comment. 'Forever negotiations' It was three weeks ago that EU Commission President Ursula von der Leyen shook hands with Trump in Scotland over what she called an "all-inclusive' tariff of 15% that officials in Brussels later understood to be a ceiling that would also apply to cars. VDA, which represents Germany's car industry, is pressing for fast implementation to alleviate a "considerable burden' on manufacturers and their suppliers. "The deal between the EU and the U.S. has not yet brought any clarity or improvement for the German automotive industry,' VDA President Hildegard Müller said in a statement on Thursday. "The costs incurred run into the billions and continue to rise.' Volkswagen body shells on the production line at a factory in Dresden, Germany | BLOOMBERG Cecilia Malmstrom, the former European commissioner for trade who's now a nonresident fellow at the Peterson Institute for International Economics, cautioned that any delays may be purely administrative. But "if nothing happens, there will be huge pressure on the European Commission to retaliate or to act in some way, especially from carmakers in Germany, Italy, France, Sweden and others,' she said. "There are so many other things that are vague in the EU-U.S. deal — and in the others as well — so it is likely we will see forever negotiations and a lot of filibustering.' At a press briefing on Aug. 14, European Commission spokesperson Olof Gill said Washington and Brussels are finalizing a joint statement. "The U.S. has made political commitments to us in this respect and we look forward to them being implemented,' he said. Japan's uncertainty Less than a week before the EU's announcement, the U.S. and Japan clinched a surprise deal on July 22 that lowered across-the-board tariffs and car levies to 15%. So far the broader duties have been implemented but the added tax on autos remains at 25%. Officials in Asia's No. 2 economy are waiting for an executive order from Trump to bring down the car levies, as well as an official directive — like the EU already received — to clarify that the universal tariffs don't stack on top of existing duties. Akazawa has mentioned how a Japanese carmaker is losing ¥100 million ($680,000) every hour due to the tariffs. Last month, Nissan Motor said it foresaw a ¥300 billion hit from the lower tariff rate, down from a previous estimate of ¥450 billion. But Chief Executive Officer Ivan Espinosa has warned of the difficulties in giving an accurate forecast as long as it's unclear when the tariffs will take effect and in what way. Akazawa flew to the U.S. earlier this month to confirm that the U.S. will be adjusting its executive order soon to remove the stacking, and pay back overcharges on tariffs. Neither has yet to materialize. Hyundai, Kia Facing similar questions is South Korea, which announced a trade agreement with Washington on July 31. That pact would impose a 15% tariff on imports to the U.S., including autos, alongside a $350 billion Korean investment pledge focused on shipbuilding, and $100 billion in energy purchases. Vehicles bound for export at a port in Incheon, South Korea | BLOOMBERG The 15% universal tariff took effect earlier this month under Trump's order, but like Japan, the sectoral auto tariffs remain at 25%. While South Korea's exports overall have stayed resilient in the first half of the year, thanks to front-loading by companies anticipating higher U.S. tariffs, the value of car shipments to the U.S. fell nearly 17%, and steel exports dropped more than 11%, trade data showed. South Korea's top automaker — Hyundai Motor and affiliate Kia — could face as much as $5 billion in additional costs this year even under the new 15% auto tariff. While avoiding a 25% levy will save more than $3 billion, the duty squeezes margins amid softer demand and tighter subsidies, intensifying competition with Japanese automakers, Chen said. South Korean President Lee Jae Myung's planned summit with Trump on Aug. 25 — their first meeting since Lee took office in June — will test the durability of the $350 billion investment pledge, as well as their alliance over sensitive issues such as defense spending, U.S. troop levels and North Korea policy. 'Just overwhelmed' For Starmer and the U.K., most aspects of the pact have now come into force, including a 10% so-called reciprocal rate that's the lowest among all U.S. trading partners. Yet Trump's 25% tax on British steel still chafes amid the delays in cutting it. Among the issues to resolve is the U.S.'s insistence that steel should be melted and poured in the U.K. in order to qualify. That's a requirement that Tata Steel U.K., one of the country's biggest producers, is no longer able to fulfill after closing down its blast furnace last year. Its new electric arc furnace is not due to be ready until late 2027. People familiar with the government's thinking are cautiously optimistic they might be able to secure exemptions to the melt-and-pour rule, whereby steel imported from certain European countries before being further processed in the U.K. is allowed to qualify as British. "It's not for lack of trying by the U.K. government,' said Tim Rutter, director of public affairs at Tata Steel. "We hear that U.S. departments are just overwhelmed.' A spokesperson for the U.K. Department for Business and Trade said officials will continue to work with Washington to implement the deal as soon as possible. Late on Friday in Washington, the U.S. Customs and Border Protection agency issued new inclusions to steel and aluminum product lists for tariffs that take effect Monday, with some of the guidance affecting imports from the U.K. Japan's Akazawa acknowledged that even with the U.K., actual implementation of key parts of their deal took 54 days. As a result, he's said that it's "not bad' if an executive order from the U.S. comes by around mid-September. "It's just further confirmation that negotiations never really end,' especially with more U.S. tariffs coming for sectors including pharmaceuticals and semiconductors, said Sam Lowe, a partner at Flint Global in London and head of its trade and market access practice.
Business Times
3 days ago
- Automotive
- Business Times
Trade partners grow restless waiting for Trump's tariff breaks
[LONDON] UK Prime Minister Keir Starmer declared at a Jaguar Land Rover factory in May that his world-leading trade deal with US President Donald Trump included a cut in US tariffs on British steel to zero. More than three months later, steel lobbyist Peter Brennan was still waiting for that relief to become reality. Brennan, director of trade and economic policy at industry body UK Steel, said most members had seen US orders fall because of the uncertainty over America's 25 per cent import tax. One producer that makes particularly price-competitive products said that they'd be out of business by year-end if tariffs are not reduced to zero, he added. 'Concern is growing that finalising the deal on steel has fallen down the priority list both for the UK and US governments,' Brennan said last week. 'The will to close the deal may well be faltering on both sides.' Frustration and economic losses like those in the UK are growing in Japan, the European Union and South Korea. Those three made similar announcements over the past month: that Washington granted them leniency on auto exports in the haggling over the level of Trump's across-the-board tariffs that took effect Aug 7. But for the trio of car export powerhouses, which, unlike the UK face a 50 per cent duty on their steel and aluminium, the wait for Trump's concession continues while an American levy justified on national security grounds on imported Toyotas, BMWs, Hyundais and others remains at a crippling 25 per cent. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up 'We are continuing to see damage, the bleeding hasn't stopped,' Japan's chief trade negotiator Ryosei Akazawa said on Friday in a reference to the country's car industry. 'We want the US to sign the executive order as soon as possible.' Spokesmen for the White House, the US Trade Representative's office and the Commerce Department did not reply to requests for comment. 'Forever negotiations' It was three weeks ago that EU Commission President Ursula von der Leyen shook hands with Trump in Scotland over what she called an 'all-inclusive' tariff of 15 per cent that officials in Brussels later understood to be a ceiling that would also apply to cars. VDA, which represents Germany's car industry, is pressing for fast implementation to alleviate a 'considerable burden' on manufacturers and their suppliers. 'The deal between the EU and the US has not yet brought any clarity or improvement for the German automotive industry,' VDA president Hildegard Müller said on Thursday (Aug 14). 'The costs incurred run into the billions and continue to rise.' Cecilia Malmstrom, the former European commissioner for trade who's now a non-resident fellow at the Peterson Institute for International Economics, cautioned that any delays may be purely administrative. But 'if nothing happens, there will be huge pressure on the European Commission to retaliate or to act in some way, especially from carmakers in Germany, Italy, France, Sweden and others', she said. 'There are so many other things that are vague in the EU-US deal, and in the others as well, so it is likely we will see forever negotiations and a lot of filibustering.' At a press briefing on Aug 14, European Commission spokesperson Olof Gill said that Washington and Brussels are finalising a joint statement. 'The US has made political commitments to us in this respect and we look forward to them being implemented,' he said. Japan's uncertainty Less than a week before the EU's announcement, the US and Japan clinched a surprise deal on Jul 22 that lowered across-the-board tariffs and car levies to 15 per cent. So far, the broader duties have been implemented, but the added tax on autos remains at 25 per cent. Officials in Asia's No 2 economy are waiting for an executive order from Trump to bring down the car levies, as well as an official directive, like the EU already received, to clarify that the universal tariffs don't stack on top of existing duties. Akazawa has mentioned how a Japanese carmaker is losing 100 million yen (S$870,500) every hour due to the tariffs. Last month, Nissan Motor said that it foresaw a 300 billion yen hit from the lower tariff rate, down from a previous estimate of 450 billion yen. But chief executive officer Ivan Espinosa has warned of the difficulties in giving an accurate forecast as long as it's unclear when the tariffs will take effect and in what way. Akazawa flew to the US earlier this month to confirm that the US will be adjusting its executive order soon to remove the stacking and pay back overcharges on tariffs. Neither has yet to materialise. Hyundai, Kia Facing similar questions is South Korea, which announced a trade agreement with Washington on Jul 31. That pact would impose a 15 per cent tariff on imports to the US, including autos, alongside a US$350 billion Korean investment pledge focused on shipbuilding, and US$100 billion in energy purchases. The 15 per cent universal tariff took effect earlier this month under Trump's order, but like Japan, the sectoral auto tariff remains at 25 per cent. While South Korea's exports overall have stayed resilient in the first half of the year, thanks to front-loading by companies anticipating higher US tariffs, the value of car shipments to the US fell nearly 17 per cent, and steel exports dropped more than 11 per cent, trade data showed. South Korea's top automaker Hyundai Motor and affiliate Kia could face as much as US$5 billion in additional costs this year even under the new 15 per cent auto tariff, according to Bloomberg Intelligence analyst Joanna Chen. While avoiding a 25 per cent levy will save more than US$3 billion, the duty squeezes margins amid softer demand and tighter subsidies, intensifying competition with Japanese automakers, Chen said. South Korean President Lee Jae Myung's planned summit with Trump on Aug 25, their first meeting since Lee took office in June, will test the durability of the US$350 billion investment pledge, as well as their alliance over sensitive issues such as defence spending, US troop levels and North Korea policy. 'Just overwhelmed' For Starmer and the UK, most aspects of the pact have now come into force, including a 10 per cent so-called reciprocal rate that's the lowest among all US trading partners. Yet Trump's 25 per cent tax on British steel still chafes amid the delays in cutting it. Among the issues to resolve is the US's insistence that steel should be melted and poured in the UK in order to qualify. That's a requirement which Tata Steel UK, one of the country's biggest producers, is no longer able to fulfil after closing down its blast furnace last year. Its new electric arc furnace is not due to be ready until late 2027. People familiar with the government's thinking are cautiously optimistic that they might be able to secure exemptions to the melt-and-pour rule, whereby steel imported from certain European countries before being further processed in the UK is allowed to qualify as British. 'It's not for lack of trying by the UK government,' said Tim Rutter, director of public affairs at Tata Steel. 'We hear that US departments are just overwhelmed.' A spokesperson for the UK Department for Business and Trade said officials will continue to work with Washington to implement the deal as soon as possible. Late on Friday in Washington, the US Customs and Border Protection agency issued new inclusions to steel and aluminium product lists for tariffs that take effect Monday, with some of the guidance affecting imports from the UK. Japan's Akazawa acknowledged that even with the UK, actual implementation of key parts of their deal took 54 days. As a result, he's said that it's 'not bad' if an executive order from the US comes by around mid-September. 'It's just further confirmation that negotiations never really end,' especially with more US tariffs coming for sectors including pharmaceuticals and semiconductors, said Sam Lowe, a partner at Flint Global in London and head of its trade and market access practice. BLOOMBERG
Time of India
3 days ago
- Business
- Time of India
Taxman sets out to draw up a crypto code
MUMBAI: India's apex tax body has asked the cryptocurrency players whether the country needs a new law on virtual digital assets (VDA), which agency should administer such a statute, and whether the present tax regime has driven out traders and businesses to foreign shores. Crypto platforms have been also asked by the Central Board of Direct Taxes ( CBDT ) if the 1% tax-deducted-at-source (TDS) on every sale was too high, what should be the preferred TDS rate and why, and whether traders should be allowed to set off VDA losses to make the levy more equitable. A flurry of such questions, raising several other issues on the travails of the trade, have stoked hopes in the crypto industry which has been battered by stiff taxes, regulatory void, and Reserve Bank of India's customary aversion towards cryptos. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Undo Not only are crypto gains taxed at the income tax rate of 30% (unlike the lower capital gains tax on stock profits), VDA traders can't offset profits with losses to lower the tax outgo. Many high-street banks are reluctant to offer accounts dedicated to pay or receive funds from crypto trades following central bank senior officials occasionally voicing their reservations on VDAs. Besides, there is no clarity under RBI rules and the Foreign Exchange Management Act ( FEMA ) on whether residents can buy and sell cryptos on offshore platforms. Crypto Tracker TOP COIN SETS Web3 Tracker 2.75% Buy BTC 50 :: ETH 50 2.16% Buy Crypto Blue Chip - 5 1.09% Buy AI Tracker 0.52% Buy DeFi Tracker -0.71% Buy TOP COINS (₹) BNB 74,638 ( 1.46% ) Buy Solana 16,660 ( 0.79% ) Buy Ethereum 389,703 ( 0.75% ) Buy Bitcoin 10,268,224 ( -0.04% ) Buy XRP 270 ( -0.59% ) Buy A combination of such factors has caused many large crypto investors to shift their trades-and in some cases even relocate-to Dubai which plans to position itself as the world's crypto capital. Did you Know? The world of cryptocurrencies is very dynamic. Prices can go up or down in a matter of seconds. Thus, having reliable answers to such questions is crucial for investors. View Details » Chances are India too may change tack, thanks to the crypto adaptation by advanced markets and the digital coins emerging as an asset class and underliers of US mutual funds. Live Events According to Purushottam Anand, advocate and founder of Crypto Legal, a blockchain and crypto-focused law firm, "Considering the G20 Synthesis Paper, Finance Track Communique, and the recent Parliamentary Standing Committee on Finance announcement selecting VDAs for a detailed examination this year, it is likely that the government will introduce a comprehensive VDA regulation. India has consistently emphasised that regulation or banning can be effective only with significant international collaboration." Since China remains the only major economy to impose a blanket ban, the global consensus today clearly leans towards regulation rather than prohibition, said Anand. SEBI , RBI, MeitY , or FIU-IND? Crypto platforms were asked to share their views by mid-August to the data analytics cell of CBDT. Here are some of the specific questions raised by CBDT: (a) Do you think the current VDA regulation in India is adequate or a comprehensive VDA law is required and the agency which you consider should be authorised to administer it (e.g, Sebi, RBI, MeitY, FIU-IND)? (b) What percentage of trading volumes has moved offshore, and under what circumstances (eg tax concerns, regulation, liquidity)? Which are the jurisdictions where users/businesses are shifting? (c) How would you compare India's VDA tax framework with major jurisdictions? (d) Have you observed any market impact due to the disallowance of loss set-off or carry-forward? In your view, how has the 30% flat tax affected volumes, liquidity etc? (e) What is the biggest challenge in implementing the TDS-identifying counterparty's residency status, calculating the market value of VDA, handling peer-to-peer transactions, or reporting to the income tax department's centralised processing centre? (f) Should there be different TDS treatment for market makers, or retail or institutional transactions? (g) What measures could be considered to ensure a level playing field between domestic and offshore VDA exchanges, particularly in relation to tax compliance for Indian customers? Since two years some exchanges have begun offering derivative products like crypto futures and more recently crypto options where the TDS impact is considerably lower. CDBT in its questionnaire has asked whether there was lack of legal clarity in derivatives, cross-border VDA transactions, and even in the very definition of VDA. Platforms have to also spell out whether they are ready for OECD's crypto-asset reporting framework (CARF)-a global plan to curb tax evasion and money-laundering.
