New Delhi, February 1: On Tuesday, Finance Minister Nirmala Sitharaman announced that the income from the transfer of virtual digital assets will be taxed at 30 percent, and an additional 1% tax to be imposed on the transaction of virtual digital assets. This means that all profits from the trading of cryptocurrency and Non-Fungible Tokens (NFTs) will be taxed. This also implies that crypto trading is now legal in India.

"I propose to provide that any income from transfer of any virtual digital asset shall be taxed at the rate of 30%. No deduction in respect of any expenditure or allowance shall be allowed while computing such income, except the cost of acquisition" said FM Nirmala Sitharaman during her budget speech. Union Budget 2022-23 Live: Cryptocurrency Income to be Taxed, 30% Tax On Income From Virtual Digital Assets, See Highlights of Budget Being Presented by FM Nirmala Sitharaman.

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With the taxation of digital assets, the loss cannot be set-off against any other gain, gain from transfer of the virtual digital asset is non-deductible and the gift of the virtual digital asset will be taxable as well.

Meanwhile, Finance Minister Nirmala Sitharaman also announced that the Reserve Bank of India (RBI) will introduce a digital currency "Digital Rupee" in the next financial year using blockchain and other supporting technology.

(The above story first appeared on LatestLY on Feb 01, 2022 12:44 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).