India’s Central Board of Direct Taxes (CBDT) has formally reached out to cryptocurrency platforms to assess the need for new legislation on virtual digital assets.
Tax Authority Initiative
Earlier in August, CBDT circulated a detailed questionnaire seeking opinions on taxation rules, regulatory clarity, and factors driving crypto businesses abroad.
Issues and Proposals
CBDT's questions include whether a dedicated VDA law should be framed and which agency should oversee it. Platforms are also asked about the current 1% TDS on trades and possible allowances for offsetting VDA losses.
Future of Regulation in India
Experts like Purushottam Anand, founder of the blockchain law firm Crypto Legal, believe that India is likely to change its regulatory approach to digital assets soon. He emphasized the need for international collaboration for effective regulation.
CBDT’s initiative could mark an important step towards creating a stable regulatory environment for the crypto industry in India, especially in light of international practices.
