Since the implementation of TDS rules in July, the government claims to have collected a total of Rs 60.46 crore in tax from companies for transactions in virtual digital assets (VDAs), including cryptocurrencies.
A brief about the Indian Government receives Rs 60.46 Crore since introduction of TDS on virtual digital assets:
The government implemented a 30% income tax as of April 1 along with a fee and a cess on the transfer of cryptocurrencies including Bitcoin, Ethereum, Tether, and Dogecoin.
A 1% Tax Deducted at Source (TDS) under section 194S of the I-T Act has also been implemented starting on July 1 on payments exceeding Rs 10,000 made towards virtual digital currencies in order to keep track of the money trail.
Minister of State for Finance Pankaj Chaudhary stated that CBDT undertakes outreach and awareness programs for taxpayers and deductors and also takes appropriate measures, including search and seizure operations, surveys, and inquiries, as needed.
Following the addition of Section 194S to the Income-tax Act of 1961 through the Finance Act of 2022, Chaudhary stated that 318 direct tax challans with the TDS code 194S had been received, totaling Rs. 60.46 crores.
The Finance Act of 2022 added Section 194S to the Income-tax Act of 1961, requiring all parties involved in transactions involving VDAs to deduct tax at the source with respect to the transfer of VDAs.
The minister added that there is currently no regulation of cryptocurrency assets in India and that the government does not register foreign cryptocurrency exchanges.
In order to prevent regulatory arbitrage, he remarked, “Crypto assets are by definition borderless and require international collaboration.”