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Member of Parliament in the Rajya Sabha and Indian politician, Sushil Kumar Modi has presented a proposition that taxes on cryptocurrencies should be raised from the current 30% to 50%.
Sushil Modi reveals his reasoning behind the proposal
Speaking in a parliament sitting as broadcasted on live TV, Modi asserted that taxes on crypto gains be raised to 50% so as to discourage what seems to be a growing interest in cryptocurrencies among the populace.
Reports note that the 70-year-old former Finance Minister of Bihar (a state in India) pointed out that his proposition is prompted by the fact that cryptocurrencies are a form of gamble and should be discouraged before it wrecks the Indian populace.
He also noted that he is taking a page from the book of countries like Japan, Germany, Austria, etc. which have imposed 40-50% taxes on crypto.
When asked what he thinks about GST (goods and services tax) on cryptocurrencies, Modi stated that he would like taxes to be imposed on “the whole transaction” when it comes to dealing with cryptocurrencies as evident in gambling transactions, although he concluded that it is up to the GST Council to do this.
“Are ‘.com’ and ‘internet’ the same?” Modi asked, when questioned if the discouragement of cryptocurrencies won’t suppress innovation within the young Indian populace.
He noted that the Indian government fully encourages the Blockchain industry and wishes to utilise it for other purposes like health records, land records, etc. but not cryptocurrency.
Modi concluded by stating that he cannot give a definite answer to whether crypto should be completely banned or not in India when asked. “It is a matter of a larger audience and we have to wait some time for that”, he said.
Crypto Adoption in India and the rest of South Asia
India has been known for its animosity towards cryptocurrencies in the past. In 2018, the Reserve Bank of India (RBI), India’s central bank and regulatory body banned cryptocurrencies. However, in March, 2020, the ban was set aside by a supreme court ruling.
This move saw a large influx of people into the crypto space between 2020 and 2021 as WazirX, India’s biggest exchange, saw a user base increase by 1735% from 2020 till 2021.
The RBI has since then continued in its antagonism towards cryptocurrencies, as an official two months back called for a total ban of all digital assets, citing “threat to macroeconomic stability”. Also, in May 2021, the RBI advised leaders against doing business with crypto exchanges.
Besides India, other South Asian countries have shown antipathy to cryptocurrencies. The government of Pakistan early this year gave hints of possible ban on cryptocurrencies in the country even though over 4% of the country’s population owns Crypto.
The Nepal Rastra Bank (NRB) banned all cryptocurrencies activities early this year as well. Sri Lanka, however, has not defined any laws regarding cryptocurrencies but government officials have advised nationals to be careful when dealing with cryptocurrencies.