Here’s what some of the leading voices in the industry had to say:
Edul Patel, CEO & Co-founder, Mudrex
India has consistently ranked among the top nations in crypto adoption, demonstrating growing interest in the digital asset space. However, the high taxation introduced in the 2022 Budget, especially the 1% TDS on crypto transactions, has pushed investors towards foreign platforms, making tracking and compliance more challenging. The inability to offset losses has further dampened investor enthusiasm. A reduction of TDS to 0.01% and the allowance for offsetting losses could significantly benefit investors and drive positive momentum in the industry.
Ashish Singhal, Co-founder, CoinSwitch
The Virtual Digital Asset (VDA) sector holds immense potential for India’s digital economy, but existing tax policies hinder its growth. We recommend reducing the TDS on VDA transactions from 1% to 0.01% and raising the threshold to Rs 5,00,000, which would ease the tax burden on smaller investors.
Crypto Tracker
To further support the industry’s growth, we advocate for aligning the taxation of VDA income with other asset classes and removing the current discriminatory treatment. Allowing taxpayers to set off or carry forward losses, as permitted under capital gains provisions, would establish parity and create an environment for innovation.
Gracy Chen, CEO, Bitget
India’s stance on crypto regulation is being followed by nations worldwide. It is vital for the global crypto ecosystem’s growth and for the country’s emergence as a financial and business hub. A balanced approach in the 2025 Budget could provide immense potential for innovation and financial inclusion in crypto. Reducing the currently high taxes on digital assets can increase mass adoption and transparency. At Bitget, we see India as a key market for crypto growth, and regulatory clarity can help build an environment for secure and inclusive financial solutions around crypto. Collaboration between policymakers and industry leaders will be essential to ensure this sector thrives responsibly.
Shivam Thakral, CEO, BuyUcoin
India’s Web3 industry stands at a crossroads, with high taxation acting as a significant barrier to growth. The 1% TDS and 30% capital gains tax have deterred investors and innovation. For 2025, we hope to see tax reductions that attract investments and bring talented professionals back to India, fostering a thriving Web3 ecosystem. Clear guidelines and reforms can help India harness blockchain technology to establish itself as a global leader in the digital economy.
Avinash Shekhar, Co-Founder & CEO, Pi42
High taxation on virtual digital assets is causing Indian investors to miss out on global crypto opportunities. Lowering taxes below 30% and reducing TDS from 1% to 0.01% could stimulate financial growth, boost compliance, and retain investors. Reforms like allowing the set-off and carry-forward of losses are essential to level the playing field and position India as a leader in the Web3 and blockchain revolution.
Raj Karkara, COO, ZebPay
It is crucial for India to align its crypto policies with global regulations to unlock the industry’s full potential. The Union Budget 2025 is expected to revisit the 30% tax on crypto income and the 1% TDS mechanism, with hopes for simpler tax structures to boost participation and liquidity. Formal recognition of crypto as an asset class and clear regulatory guidelines would provide stability and safeguard investors. Additionally, policies encouraging blockchain and Web3 startups could position India as a global hub for decentralized finance and innovation.
Aishwary Gupta, Global Head of Payments, Polygon Labs
India faces a significant education gap regarding cryptocurrencies and blockchain, which is reflected in its stringent crypto tax policies. The blanket 30% tax on crypto transactions is among the highest globally and is stifling innovation. While speculative trading is a part of the ecosystem, blockchain’s transformative potential lies in value-driven use cases. 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 challenges.
Real-world innovations like JioSphere by Jio and Firedrops by Flipkart demonstrate the immense potential of blockchain in India. However, without favorable tax laws, such opportunities are at risk. Startups leaving India for more supportive jurisdictions highlight the need for reform. By addressing these issues, India can retain talent, foster innovation, and unlock blockchain’s full potential for the nation.
Shahzad Nathani, Head of Operations & Partnerships, Shardeum
India has the potential to become a global Web3 hub by leveraging its digital economy and blockchain innovation. Tax breaks for Web3 startups, dedicated funds, and regulatory reforms 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)