Investors expect the cryptocurrency tax to continue as Nirmala Sitharaman returns as finance minister

India concluded general elections on June 1, with last week’s results paving the way for the re-election of Narendra Modi as Prime Minister for a third consecutive term. As part of Prime Minister Modi’s new cabinet, Nirmala Sitharaman he was reassigned as the country’s finance minister after taking over as minister in 2019. The Indian crypto community has expressed mixed reactions to Sitharaman’s reappointment as finance minister.

Cryptocurrencies in India have been under the scanner of the Ministry of Finance. From 2022, all profits from crypto transactions in India are subject to a 30% tax rate, while a tax deducted at source (TDS) of 1% is applicable on the transfer of virtual digital assets (VDA).

Dilip Chenoy, the president of Bharat Web3 Association (BWA)congratulated the new government and said the Web3 Advisory Group will continue to work with officials to foster Web3’s growth.

“At BWA, we remain committed to working with the government to foster the growth and development of the Web3 industry, with the aim of establishing India as a global hub for Web3. We look forward to our continued commitment and extend our support to the government to develop forward-thinking regulations that promote innovation while prioritizing consumer protection in the ever-evolving Web3 space,” Chenoy wrote on LinkedIn.

The Indian crypto circle was waiting for FM Sitharaman to review the tax laws imposed on the cryptocurrency sector. Despite the he shoutedthe Finance Minister did not announce any tax relief for the cryptocurrency sector when presenting the interim annual budget earlier this year.

His reappointment as finance minister has sparked concerns in the Indian crypto community, which fears that there are no tax reforms planned for the digital asset sector. Many took to social media to express their thoughts on the development.

FM Sitharaman is expected to present the complete budget for the fiscal year 2024-2025 next month. Crypto commentators expect the Finance Minister to reduce the 1% TDS cut on every crypto transaction to 0.01% as part of his next budget presentation.

In March this year, Sitharaman had She said that India did not see any cryptocurrency as a “currency” option. At the time, Sitharaman had said that “assets created in the name of cryptocurrencies can be assets for trading, assets for making money and assets for many other things.”

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