As India’s tax policies near the enforcement date of 1st April 2022, a member of parliament from the Bahujan Samaj Party (BSP), Ritesh Pandey, has express concerns in the Lok Sabha. Ritesh Pandey has said that the 1% Tax Deducted at Source (TDS) will promote “red tapism” while killing off this up and coming digital asset class.
The ‘red tapism’ idiom refers to those formal rules that are claim to be excessive and rigid.
Ritesh Pandey’s comments come against the backdrop of an outcry from India’s crypto community, which is requesting the government to reconsider the tax regime it’s pushing the crypto industry into.
Ritesh Pandey Said :
“When you impose a 1% TDS at three stages, it will give birth to red tapism. Doing so will also finish this asset class, which is very young,”.
This 1% TDS on crypto transactions, Ritesh Pandey elaborate, will require a person to pay the TDS at three stages, when a cryptocurrency is purchase, when it is transfer to a crypto wallet, and when the cryptocurrency is use to purchase another digital asset, like a non-fungible token (NFTs).
Indian celebrities like Amitabh Bachchan and Salman Khan have launch NFTs related to their identities. Bollywood movies such as ‘83 have also released NFTs.
The BSP leader said that collectors wishing to hold digital assets from such popular NFT series will have to spend extensively due to the levied taxes.
A video clipping of Ritesh Pandey’s addressal of the tax law has widely share on social media.
Today's best moment was when Mr. Ritesh Pandey from BSP understood the real problem of 1% TDS and the unethical way to taxation Crypto in India#reducecryptotax #removeCryptoTDS pic.twitter.com/mCkQiS7wj9
— CRYPTOVERSE (GIVING AWAY KNOWLEDGE) (@acryptoverse) March 25, 2022
India’s Finance Minister Nirmala Sitharaman has maintain that this TDS is solely for transaction tracking purposes.
Nirmala Sitharaman Said :
“TDS (tax deducted at source) is more for tracking. It is not additional tax and not a new tax. It is a tax that will help people track it, but at the same time the taxpayer can always reconcile it with the total tax to be paid to the government,”.
The crypto industry in India is bracing itself for the regulatory laws that take effect starting from 1st April 2022.
Industry insiders are concern that the 30% tax on crypto-generate income itself is not directly beneficial to the Indian community.
Disclaimer
Cryptocurrency is an unregulated digital currency, not a legal tender and subject to market risks. The information provided in the article is not intended to be and does not constitute financial advice, trading advice or any other advice or recommendation of any sort offered or endorsed by 2YoDoINDIA. 2YoDoINDIA shall not be responsible for any loss arising from any investment based on any perceived recommendation, forecast or any other information contained in the article.
