Several announcements made during the presentation of the 2023 Union Budget are being debated over the internet. One of them is the kind of relief that the Indian crypto industry was expecting but did not get.
A boost to the 5G network, artificial intelligence, and green hydrogen made a lot of news, as made the proposal to raise the minimum tax slab to ₹7 lacs. This suffices the majority of the population and tech-based industries except for the crypto industry.
Currently, the crypto industry in India is subject to a 30% capital gains tax plus a 1% TDS. Experts and entrepreneurs in the industry believe that a reduction in both rates would have boosted their growth, allowing users to stay with the national companies and execute more significant crypto transactions.
Blockchain and Web3 companies are in a state of apprehension as it is anticipated that their businesses will decline more after the budget is presented. The transition of users to international platforms will be felt by everyone. Simultaneously, Indian businesses could seek to establish themselves in crypto-friendly nations.
The community is looking at it through two different lenses. Some are happy that crypto has not been banned, while others have expressed displeasure over implementing heavy taxes as they discourage crypto businesses from accelerating their growth.
Nischal Shetty, the founder of WazirX, believes that reducing the TDS would have helped millions of traders in the country. He has added that India may want to regulate the industry in line with the rest of the world once global regulations are clear.
Sathvik Vishwanath, the chief executive officer of Unocoin, has stressed the importance of reviving amendments since the implementation of 1% TDS has devastated the business.
Sumit Gupta, the chief executive officer of CoinDCX, echoed this sentiment, stating that everyone had hoped for a tax reduction on Virtual Digital Assets, but it did not occur. Sumit feels that a higher tax on crypto trading is a major factor in the migration of investors outside, which is bad for the country that has the potential to become the Web3 hub.
Most of the top crypto exchanges in India share the same belief while acknowledging that the budget sets India on the path of becoming one of the leading economies globally. True to its core, India continues to grow at a time when some of the major economies are reporting inflation and recession.
The future looks to follow the trajectory, with estimates from the International Monetary Fund forecasting growth of 6.8% in FY23.
Cryptocurrency and the industry have a tough time ahead, considering that the Reserve Bank of India has suggested a complete ban on digital currencies with zero intrinsic value and the potential to cause financial stability. The 2023 Union Budget also brought nothing for cryptocurrency, adding to their worries.