After a long time discussion, Mrs Nirmala Sitharaman came up with her suggestion in the Budget about taxation of “Crypto Assets”.
At first glance it appears that this provision imposes a 30% tax on gains made in crypto assets which may include the Bitcoins as well as the Meta Verse assets, the Virtual Taj Mahal, etc. Since the loss cannot be off set with other income, the 30% tax will be a serious disincentive for acquiring virtual assets.
So far so good.
However, it is also true that the “Lure for tax collection” has corrupted the minds of the Finance Minister to provide legitimacy to the Crypto assets. What is taxed today at 30% can always be changed to 10% or declared as normal business income to be available for aggregation with other income and expenditure. The Crypto Criminals will be only too happy to wait for one more year in the next budget to ask for reduction of the tax rates.
I therefore consider that the move of taxing Crypto Assets is not a proper solution to prevent the destruction of the society by development of Crypto assets. The taxation could have been used only as a one time instrument to ensure an exit route for ordinary investors when the Crypto assets are banned.
I want to challenge the Finance Minister why she cannot tax holding of “Drugs” and “Weapons” as an investment so that the Government can earn revenue.
Please remember that now it is possible to develop a derivative of a “Drug Crypto” or a “Weapon Crypto” where the investor will hold only the Digital Asset while a syndicate will use the funds raised to create an asset foundation in drugs or weapons.
“Innovators” can create “Digital Asset class” of “Weapons of mass destruction”, “Bio Weapons”, “Addictive ecstatic drugs” and so on.
Government of India would be happy to collect GST and IT from traders and investors while the proceeds of these assets go to break India into pieces.
I therefore seriously object to the new provision and demand that the “Banning of Private Crypto Assets” Bill is introduced immediately.
Naavi
