Cryptocurrency in Budget 2022: Know why government introduced 1 percent TDS despite imposing 30 percent tax on crypto

[ad_1]

New Delhi: The biggest announcement by Finance Minister Nirmala Sitharaman in the budget today is the imposition of tax on cryptocurrency. They have imposed a 30 percent tax on profits from cryptocurrency. That is, if you earn 1 lakh from bitcoin or any other cryptocurrency, then you have to pay 30 thousand rupees in tax. Not only this, it has also been decided to charge 1 percent TDS on cryptocurrency. Now the question is that when 30 percent tax is levied, what is the point of 1 percent TDS?

TDS is charged for monitoring, not for earning
During the press conference, Nirmala Sitharaman has clarified that she has imposed 1 percent TDS on cryptocurrencies so that the transactions that happen in the crypto world can be monitored. Actually no cryptocurrency regulation system has been made yet so TDS is used.

Budget 2022: Sitharaman said on the issue of tax cuts – ‘Tax has not increased for 2 years after PM, did not try to earn’
How will TDS monitor crypto?
TDS means Tax Deducted at Source. This means that the tax is deducted before you have the money. This way, if you made a profit of 1 lakh rupees by selling crypto, then 1 percent of it will be deducted as TDS as soon as it reaches your bank account. You must then pay 30 percent tax on your profit. Because of this 1 percent TDS, the government will know how much you have done in crypto transactions and how much tax liability you have to pay.

‘Cryptocurrency’ is not a currency
Nirmala Sitharaman has said that any currency is considered a currency only when it is issued by the central bank. Apart from this, everything else is not currency in which cryptocurrency also comes. Cryptocurrency is not issued by the central bank, but it is made by individuals. He said the digital currency will soon be issued by the Reserve Bank, whose name will also be decided. At the same time, he said that there will also be a system for regulating crypto, but until the regulation comes, taxation of those who earn from crypto cannot wait.

[ad_2]

Source link

Leave a Comment