In her Budget 2022 speech, Finance Minister Nirmala Sitharaman said that all transactions involving virtual or digital assets should have a TDS of 1%. The bitcoin community and market experts in the country think that this decision will have a big effect on bitql official website, though the details are still being worked out.
Sitharaman said, “I also plan to set up TDS on payments made for the transfer of 24 virtual digital assets at the rate of 1 percent of such consideration above a certain amount of money so that I can keep track of the details of the transaction.” “I also want to make sure that TDS is taken out of payments made for the transfer of 24 virtual digital assets at the rate of 1% of such consideration above a certain amount of money.”
Crebaco, a cryptocurrency research and consulting firm, has found that the number of deals on WazirX has dropped by 82%. On ZebPay, the discount was about 76%, and on CoinDCX, it was over 70%.
It’s too early to guess what TDS will do at this point. “By the middle of the second week of July, we should have a better idea of what’s going on,” said Rajagopal Menon, vice president of WazirX
The amount of money traded on bitcoin exchanges has increased by a factor of 100 in the last year. Investors have been interested in cryptocurrencies for a long time. ET said on April 1 that the top five to six Indian cryptocurrency exchanges will handle a total of $70 billion to $100 billion in trading in 2021, with WazirX alone handling more than $43 billion. These numbers came from what business people said they thought would happen.
What it means for people in business?
People who work in the industry think that the bear market will make trade even worse. This is a direct result of how the world economy is doing right now.
During this time, a number of day traders told ET that the grey market would keep growing in these circumstances, and that they would try out different ways to trade to see if it would be better to stay on Indian exchanges or not.
Shounak Shetty, who is 28 years old and from Mumbai, said that his company’s daily assets under management dropped from Rs. 14 crore in March to Rs. 23 crore.
On March 31, I stopped doing most of my work, and even more has stopped since Friday. “I’ll test models on small accounts to see if any can still make money this fiscal year,” said Shetty, who is in charge of crypto portfolios. Shetty says that this could make more skilled merchants move to places like Dubai and other places where they are more welcome.
Another trader from Mumbai said, “I will stop trading on Indian exchanges right away,” but asked not to be named.
The peer-to-peer cryptocurrency market in India, which is made up of thousands of direct buyers and sellers, will trade more often on decentralised exchanges or overseas exchanges.
The rules for TDS should be easier to understand.
Sunil Badala, a partner at KPMG in India and the head of Financial Services, Tax, said that even though the guidelines address a lot of worries, there are still a lot of problems that haven’t been fixed. When the rules came out, this was talked about.
“It’s not clear how the exchange will know if the VDA it buys belongs to the exchange or to someone else. Badala says it might be easier for exchanges to keep the stock and agree with the buyer that taxes will be paid every three months.
“The reason given for why TDS has to be left out of the net seems to be wrong (less GST and levies). The rules say that GST and charges that are “levied by the deductor” should not be included. In practise, however, fees are “charged by the exchange/brokers,” he said.
