The RBI has stated in the past that it will soon begin working towards the “phased implementation” of its own digital currency
In a big ‘no’ to crypto currencies, Digital Rupee will be introduced in India during the 2022-23 financial year, Nirmala Sitharaman said on Tuesday while presenting the Union Budget.
“Introduction of Central Bank Digital Currency will give a big boost to the digital economy. Digital currency will also lead to a more efficient and cheaper currency management system,” she said. “It is, therefore, proposed to introduce Digital Rupee, using blockchain and other technologies, to be issued by the Reserve Bank of India starting 2022-23,” she added.
“Digital Rupee is one of the most-awaited announcements. It is important to understand how other crypto assets will be taxed and whether there will be any specific benefit given to the Digital Rupee,” said Bhatia, partner and leader – tax and regulatory services, BDO India.
“With no deduction for cost, tax rate at 30%, tax on mining/gifting and no offset of loss against income from other sources, the FM has given the much-needed clarity on crypto transactions. However, tracking such transactions in the absence of a central regulator may be challenging,” he noted.