Follow Slashdot stories on Twitter

 


Forgot your password?
Close
typodupeerror
×
Bitcoin

India Proposes a 30% Tax on Crypto and NFTs Income (techcrunch.com) 87

Posted by msmash from the moving-forward dept.
India on Tuesday announced plans to launch a digital currency by next year and tax cryptocurrencies and NFTs as the country moves closer to recognizing cryptocurrencies as legal tender in the world's second largest internet market. From a report: Income from the the transfer of any virtual assets will be taxed at 30%, the nation's finance minister Nirmala Sitharaman said Tuesday. To capture details of all such crypto transactions, she also proposed a 1% tax deduction at source on payments made related to purchase of virtual assets. "No deduction in respect of any expenditure or allowance shall be allowed while computing such income except cost of acquisition. Further, loss from transfer of digital asset cannot be set off against any other income," she said in one of New Delhi's most remarkable tech and business-focused federal budgets. "Gift of virtual digital asset is also proposed to be taxed at the hand of the recipient."
This discussion has been archived. No new comments can be posted.

India Proposes a 30% Tax on Crypto and NFTs Income More

India Proposes a 30% Tax on Crypto and NFTs Income

Comments Filter:

  • India isn't the only place who taxes income on crypto, Sweden does it too, it's just the WAY it's being done that is horribly complicated because it's still so new to most countries.

    Banks hate crypto with a passion, the governments aren't thrilled about it either. Crypto was a regular mans way of saying hey - we will take money and handle it ourselves, banks don't like that because in the bank you save your money, and the bank handles your money, they make the investments, borrow your money to businesses an

    • The thing is, it isn't taxed like income. Like other capital gains, It is taxed far less than actually productive activities, manual labor in particular.

      • The capital gains for "Collectibles" are taxed at 28%. If you are doing manual labor the rate is probably no higher than 22%, and maybe only 12%, depending on marital status and actual income, etc.

        • Re: (Score:2)

          by jhecht ( 143058 )
          Actually, if you're doing manual labor you pay up to 22% in income tax PLUS 6.2% in Social Security tax (assuming you're on salary; it's twice that if you're self-employed although the details are complex). So a salaried manual laborer can pay more than the tax on collectibles.

          • ... PLUS 6.2% in Social Security tax (assuming you're on salary; it's twice that if you're self-employed although the details are complex).

            It's twice that either way. The portion of the payroll tax your employer pays on your behalf comes from the same "cost for the company to employ you" bucket as your salary. Splitting it this way just makes it look smaller on the pay stub.

        • I went and looked up the US tax laws on cryptocurrency and got the NFT law as a bonus.

          https://taxbit.com/blog/crypto... [taxbit.com]

          An NFT is a "collectible" and gains are taxed at 28% whereas cryptocurrency is treated as a stock and taxed at 0 to 20% depending on other details IF it has been held for at least a year. There is also a 3.8% ( I think) surtax if your investment profits exceed some other total which is much higher than I ever made.

          If you held your cryptocurrency for less than a year then it counts as short

    • Re:Taxing crypto is too complex as it is now. (Score:5, Interesting)

      by neilo_1701D ( 2765337 ) on Tuesday February 01, 2022 @10:06AM (#62226683)

      Crypto was a regular mans way of saying hey - we will take money and handle it ourselves

      Oh, you so need a citation for this statement. Since when has cryptocurrency ever been about regular people?

      Unless, of course, you're referencing Paul Krugman's [nytimes.com] article on the strange way cryptocurrency and MAGA have become intertwined (both peddle fear, in Krugman's opinion); in which case come out and say it.

      • Crypto was a regular mans way of saying hey - we will take money and handle it ourselves

        Yup: Crypto owners are 99% Tech Bros, and all trying to make a killing from later entrants, rather than use crypto"currency" to buy stuff.

    • as long as its "on income" but i dont see why it would need to be more than "on income from stocks & shares" its just old people in suits wrecking and choking the future again. If its on "hey atm your assets are worth 10k, so you pay the fiat tax on that" and by morning it dumps to $4000 and you have to pay $6000 (or *3300 in india) as "same as normal income" i see some discrepancies in the force.
      the message here is the same as everywhere: the BOE doesnt want it so you can have the one we issue and th

  • Don't stop there, India. (Score:5, Insightful)

    by h33t l4x0r ( 4107715 ) on Tuesday February 01, 2022 @07:51AM (#62226441)
    Tax all capital gains at 80%. What? That's not popular with your lawmakers, India? That's ok, but now guess why.

    • Re: (Score:2)

      by Junta ( 36770 )

      I'll largely agree, with exceptions.

      If I have to move but the market doubled home values since I bought my house, then having barely more than I had 20 years ago to buy my new house would really not give me much to work with to buy a house now.

      But if I'm cashing in my stock, then that unearned income should be taxed.

      Capital gains on real estate may fall under either a situation of unearned income or just market pressures inflicted on a middle class person forced to move, so would need to carefully delineate

      • Capital gains on real estate have a grace period for reinvestment (in the US at least), presumably for exactly that reason. E.g. you can sell your old house for 2x as much as you paid, and so long as you use the money to buy a new home within a few months you don't have to pay taxes on the capital gains for the money you spent.

        I'm totally behind that for your primary residence, and even a business location, for exactly the reason you point out. I'm far less convinced it's a reasonable concession for re

        • Re:Don't stop there, India. (Score:5, Informative)

          by stabiesoft ( 733417 ) on Tuesday February 01, 2022 @12:30PM (#62227055) Homepage
          Not sure that is still true. I thought that was replaced in the 1990's with a 250K single/500K married exclusion allowance. So say married and gain was 700K, only 200K is considered a cap gain on a primary house sale. I think you can do this every 2 years. In some ways it penalizes people who live in one place for a long time though. My gain is way over the limit after 20 years. Would have better off trading house every 5 years and staying under the threshold. Of course that would be offset by moving and real estate agent costs. I would have preferred they index the gain to time. Say 20-50k/year maybe. And for those with kids, there is the whole stepped up basis thing when you die.

          • Re: (Score:2)

            by Ambvai ( 1106941 )

            I think the parent is referring to a 1031, which, simplified, lets you take the full value of a property and apply it towards the purchase of another conceptually similar property (primary residence for primary residence, commercial for commercial, etc.).

            While there are exceptions and whatnot, you can basically use this to keep rolling down the line into more and more expensive properties (relative to purchase price), and you only pay capital gains taxes if you downgrade a transaction, or sell for cash at t

            • I believe so. My mother did the same a few years back at the advice of her lawyer brother. I'm not sure how normal people are supposed to hear of such things - and my inner cynic thinks maybe that's kind of the point.

              After all, a tax loophole that everyone uses just means taxes have to be increased, and nobody benefits but the accountants. While a tax loophole that only gets used by people who routinely pay lawyers and accountants to advise them on their finances cuts taxes primarily for the rich, withou

            • Not sure how accurate investopedia is but whoa, rules for 1031 are numerous. From the link https://www.investopedia.com/f... [investopedia.com], "Usually, a primary residence does not qualify for 1031 treatment because you live in that home and do not hold it for investment purposes. However, if you rented it out for a reasonable time period and refrained from living there, then the primary residence becomes an investment property, which might make it eligible." It looks like 1031 is mainly for investment property, so I'd see

              • Re: (Score:2)

                by Ambvai ( 1106941 )

                "Both."

                1031 is indeed for investment purposes, but if you plan on selling a primary residence in a few years, there are various legal shenanigans you can setup in place to your advantage... one of the most valuable of which is probably combining it with what you were thinking of, the 121 (which has the 250k/500k limit, can only be done every few years, etc.). It imposes a few restrictions on the property you buy, but those also have 'standardized' loopholes you can work with as well. Any decent real estate

        • I don't know why rental properties should be different say you want to move, and because you want to manage a the property you sell and buy somewhere else. You haven't realized any profit, why should you pay? It is the same thing, if you ever sell up you will have to pay the capital gains. Rentals can be used to you know make rental income, I know its not savvy investors do, but just because the property market has become insane doesn't mean people don't do it.

      • Re: (Score:2)

        by ceoyoyo ( 59147 )

        An 80% capital gains tax on real estate would be a fantastic idea. If that existed your house wouldn't have doubled (or tripled or quadrupled) in price.

        • An 80% capital gains tax on real estate would be a fantastic idea

          Yes, if by "fantastic idea" you meant "no one could afford to move, ever because a new home anywhere would be vastly out of reach after only 20% of gains on a home sale could be kept in addition to initial costs".

          Lets say you bought a house 20 years ago for $100k, now worth one million (hello inflation!).

          You go to sell your house and you sell it for a million dollars - awesome! Except that 80% taxes take away $720k of that...

          Now you are left

          • Re: (Score:2)

            by ceoyoyo ( 59147 )

            As I said, if such a thing existed then that house you bought for $100k wouldn't suddenly be worth a million. That's a *good* thing. Houses aren't supposed to appreciate, and didn't before 2003 or so.

            Give 2% per year grace for inflation if you must.

            • We know what the national average housing inflation is per year. No need to fudge it when we can reference it directly. For example, from 2002 to 2021, housing prices inflated on average 59%. Plus, if you factor in primary residence tax credit, the kept amount after a 900k gain like gp's story would be 680K at 80% cgt. If it's an investment house or second house, sounds like they're rich enough to pay the full 80% cgt.

            • that house you bought for $100k wouldn't suddenly be worth a million.

              20 years (the time period I gave in my example) is not suddenly.

              Give 2% per year grace for inflation if you must.

              The whole point of my example was not numbers, but the fact that over a long period of time if a house has large gains, taxes whatever gains there are so heavily makes it impossible to maintain the quality of home you have.

              In the past few years especially, people have had large gains and punishing them with an 80% tax seems (as

      • Re: (Score:2)

        by teg ( 97890 )

        If I have to move but the market doubled home values since I bought my house, then having barely more than I had 20 years ago to buy my new house would really not give me much to work with to buy a house now.

        But if I'm cashing in my stock, then that unearned income should be taxed.

        Capital gains on real estate may fall under either a situation of unearned income or just market pressures inflicted on a middle class person forced to move, so would need to carefully delineate between those scenarios.

        Homes are often handled in a specific way to avoid the problem you are describing. E.g. in Norway, gains selling your primary home are non-taxable as long as you've lived there in at least 12 of the last 24 months. Selling other real restate triggers normal capital taxation (but since this is taxable, you can also deduct expenses for work done on the property, expenses for selling it etc).

    • >Tax all capital gains at 80%.

      Sounds like a good way to drive most investment overseas to me.

      On the other hand I'm 100% behind taxing capital gains exactly the same as earned income - there's absolutely no reasonable justification for taxing the money your money earned should at a dramatically lower rate than the money *you* earned. It's just a huge tax break for the rich

      And before anyone says "but almost everyone owns stocks" - yes, they do. But almost everyone is just playing on the beach with penny-

      • Re: (Score:3)

        by DarkOx ( 621550 )

        taxing capital gains is fundamentally double dipping, ALL the activity associated with the gain is taxed already. Capital gains should NOT be taxed at all, or profits and incomes should not be taxed and ONLY capital gains should be taxed.

    • Tax all capital gains at 80%.

      That's a terrible idea. It would stifle all investment. We need investment. It builds factories, offices, and stores.

      What we want to suppress (not eliminate) is speculation. That could largely be accomplished by reducing the capital gains tax in proportion to the length of time the asset is held. It's also why short term capital gains are taxed at higher rates in some countries.

  • Crypto bros go: (Score:4, Insightful)

    by Vintermann ( 400722 ) on Tuesday February 01, 2022 @07:57AM (#62226445) Homepage

    recognizing cryptocurrencies as legal tender

    Yes!

    Income from the the transfer of any virtual assets will be taxed at 30%
    No deduction
    No set off losses

    Aaugh! Not like THAT!

    • Re: (Score:2, Insightful)

      by splutty ( 43475 )

      But But... "They" told "us" we could have it both ways! Are you telling "us" that "They" lied about crypto!???!!

    • a suitable enforceable tax would put the brakes on wash trading of monkey pictures, so that would be a good thing.

    • Nope, mislabeled"cryptocurrency" is not even real money, fails all the tests of money. Can't be legal tender if it's not even money. They are gambling tokens depending on steady stream of new suckers to the casino. We're running out of chumps...

  • Should be 90% (Score:2, Insightful)

    by TheNameOfNick ( 7286618 )

    It is all tax evasion and produces nothing of actual value. Funny tax for funny money.

    • Its taking people out of jobs they hate, and making them financially free. But I suspect you were the one who missed out on that opportunity, which is why you love giving away money to crooked politicians.

  • Whatever the government structure, one truth remains: Taxes shift the power away from the citizens to the government. This is why governments — of all kinds — love taxes. The more the better.

    Because the people in government think, that they know better, how to spend the citizens' monies. For our own good...

    Most of these overlords are, actually, even sincere in their thinking so...

    • Found the clueless fuck (Score:1)

      by Anonymous Coward

      Whatever the government structure, one truth remains: Taxes shift the power away from the citizens to the government

      Found the clueless fuck [urbandictionary.com] that doesn't understand how taxes work, and just keeps spewing the capitalist verbal diarrhea.

  • I mean sure you can do it, but why would anyone comply? The primary use of Crypto is money laundering, ponzi schemes and tax evasions. The speculators build off that base and Bob's Your Uncle there's your crypto markets.

    This is either a round about way to kill crypto (I've said it before, but if you regulate crypto like any other financial instrument it'll die immediately as the bottom drops out of it's 3 main use cases) or a nothing burger.

    • in the US we're required to report income even if gained illegally. The IRS is pretty explicit that stolen goods, bribes and kickbacks all must be reported. But I will admit, there are few places in the world quite as wacky as America and our government. India has a long ways to go before they can beat us in that department.

      > 26 CFR SS 1.162-18 - Illegal bribes and kickbacks.

      It's right there between "Reporting and substantiation of certain business expenses of employees." and "Capital contributions to Fe

      • It's hard to hide income while still gaining any advantage from it. Sure, a tax agency couldn't tell if you steal a trillion bucks and bury it in the desert without reporting it. But if you are spending/borrowing against it, it almost certainly leaves a paper trail and evidence. Sure boosting your income by 1% will not get caught (but that's not much gain either) -- your risk rises with possible gain.

        Now granted the IRS budget has been slashed to prevent them from investigating tax cheats, but that is not a

  • Here in the USA, you have capital gains taxes, and the rate varies based on how long you hold onto a stock. The problem with crypto isn't just that you can buy/sell it the way you could a stock, you can also mine it, and THAT gets messy. If you treat it like a business, you could then look at the cost of equipment used to mine the crypto, the cost of electricity, space taken up then acts like office space in the home, or leased space. Capital Gains here in the USA also has long term taxed at only 15
  • I expect nothing better from a country that pollutes it's "holy river" with garbage, and feces, then bathes in it.

  • You Wanted Crypto to Be Currency (Score:3)

    by sudonim2 ( 2073156 ) on Tuesday February 01, 2022 @02:42PM (#62227429)
    Well, currency gets taxed.

  • It seems to work ok for Apple and people stand in line to do it.

Slashdot Top Deals

"Gravitation cannot be held responsible for people falling in love." -- Albert Einstein

Close