Here’s a glimpse into the perspectives of some leading voices in the field:
Edul Patel, CEO & Co-founder, Mudrex
India consistently ranks high in global crypto adoption, reflecting a growing interest in digital assets. However, the implementation of high taxes in the 2022 Budget, notably the 1% TDS on crypto transactions, has driven investors to international platforms, complicating tracking and regulatory adherence. The inability to offset losses has further discouraged investor participation. Lowering the TDS to 0.01% and permitting loss offsetting could significantly benefit investors and stimulate positive growth within the sector.
Ashish Singhal, Co-founder, CoinSwitch
The Virtual Digital Asset (VDA) sector presents a significant opportunity for India’s digital economy, but current tax policies are impeding its progress. We suggest reducing the TDS on VDA transactions from 1% to 0.01% and increasing the threshold to Rs 5,00,000, which would alleviate the tax burden on smaller investors.
To further support the industry’s growth, we recommend aligning VDA income taxation with that of other asset classes and eliminating the existing discriminatory treatment. Allowing taxpayers to offset or carry forward losses, as permitted under capital gains provisions, would establish fairness and foster an environment conducive to innovation.
Gracy Chen, CEO, Bitget
The world is watching India’s approach to crypto regulation. This is crucial for the global crypto ecosystem’s development and for India to become a major financial and business center. A well-considered strategy in the 2025 Budget has great potential for innovation and financial inclusion in crypto. Decreasing the currently high taxes on digital assets can increase general adoption and transparency. At Bitget, we view India as an important market for crypto growth, and clear regulations can create an environment for secure and inclusive financial solutions around crypto. Collaboration between policymakers and industry leaders will be vital to ensure this sector grows responsibly.
Shivam Thakral, CEO, BuyUcoin
India’s Web3 industry is at a critical point, with high taxation acting as a major obstacle to growth. The 1% TDS and 30% capital gains tax have discouraged both investors and innovation. For 2025, we hope to see tax cuts that attract investments and bring talented professionals back to India, promoting a flourishing Web3 ecosystem. Clear guidelines and reforms can help India use blockchain technology to establish itself as a global leader in the digital economy.
Avinash Shekhar, Co-Founder & CEO, Pi42
High taxes on virtual digital assets are preventing Indian investors from taking advantage of global crypto opportunities. Lowering taxes below 30% and reducing TDS from 1% to 0.01% could stimulate financial growth, improve compliance, and retain investors. Reforms such as allowing the set-off and carry-forward of losses are essential to create a level playing field and establish India as a leader in the Web3 and blockchain revolution.
Raj Karkara, COO, ZebPay
It is important for India to align its crypto policies with global standards to fully realize the industry’s potential. The Union Budget 2025 is anticipated to re-examine the 30% tax on crypto income and the 1% TDS mechanism, with hopes for simpler tax structures to increase participation and liquidity. Formal recognition of crypto as an asset class and clear regulatory guidelines would provide stability and protect investors. Furthermore, policies supporting blockchain and Web3 startups could position India as a global center for decentralized finance and innovation.
Aishwary Gupta, Global Head of Payments, Polygon Labs
India faces a significant knowledge gap regarding cryptocurrencies and blockchain, which is reflected in its strict crypto tax policies. The uniform 30% tax on crypto transactions is among the highest worldwide and is hindering innovation. While speculative trading is part of the ecosystem, blockchain’s real value lies in practical applications. Startups receiving global grants must pay 30% in taxes, unlike other businesses that benefit from DPIT certification exemptions. Additionally, taxing gas fees for blockchain transactions creates operational difficulties.
Real-world innovations like JioSphere by Jio and Firedrops by Flipkart demonstrate the immense potential of blockchain in India. However, without supportive tax laws, these opportunities are at risk. Startups relocating from India to more favorable locations highlight the need for reform. By addressing these issues, India can retain talent, encourage innovation, and unlock blockchain’s full potential for the nation.
Shahzad Nathani, Head of Operations & Partnerships, Shardeum
India has the capacity to become a global Web3 hub by utilizing its digital economy and blockchain innovation. Tax incentives for Web3 startups, dedicated funding, and regulatory changes could drive growth and attract top talent. Skill development programs and incentives are essential to position India as a leader in blockchain advancements.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)