Budget 2025: Here’s what centre announced on crypto regulations and tax | Stock Market News
Source: Live Mint
The Union Budget 2025-26 did not introduce any significant relief for cryptocurrency investors, maintaining the 30 per cent tax on crypto gains and the 1 per cent TDS on transactions. However, Finance Minister Nirmala Sitharaman proposed an amendment to the Income Tax Act, mandating that a designated reporting entity disclose transaction details related to virtual digital assets (VDAs).
“It is proposed to bring amendment in the Income Tax Act to provide for that a prescribed reporting entity in respect of a crypto-asset shall furnish information in respect of a transaction in such crypto asset, in a statement as prescribed. It is also proposed to align the definition of virtual digital asset accordingly,” the Budget document reads.
No changes in crypto tax
The budget did not make any changes to the 30 per cent tax on crypto income or the 1 per cent TDS on crypto transactions, which were implemented in July 2022.
Additionally, the government did not apply the Securities Transaction Tax (STT) to crypto futures and options (F&O), maintaining the current tax framework.
While cryptocurrencies remain unregulated in India, the introduction of a dedicated section for VDAs in the ITR forms for FY 2023-24 indicated the government’s intention to monitor crypto transactions.
In the previous budget, Finance Minister Nirmala Sitharaman excluded crypto futures and options from the proposed increase in STT.
In the 2024 Budget, the minister raised the Securities Transaction Tax (STT) on stock futures and options contracts. However, there was no mention of crypto futures and options contracts, as crypto transactions are classified as commodities.
Crypto investors also appreciated the government’s decision not to impose a tax deducted at source (TDS) or a 30 per cent tax on crypto gains within the futures and options segment.
Since July 1, 2022, the government has applied a 1 per cent TDS on all virtual digital assets, such as cryptocurrencies, under Section 194S, despite the absence of regulation for emerging assets.
About crypto tax
Crypto investors welcomed the government’s decision to exclude the tax deducted at source (TDS) and the 30 per cent tax on crypto gains for the futures and options segment.
Since July 1, 2022, the government had implemented a 1 per cent TDS on all virtual digital assets, including cryptocurrencies, under Section 194S, despite the absence of specific regulations for these emerging assets.
The TDS was introduced to integrate virtual digital assets into the tax framework. Additionally, the Finance Act of 2022 imposed a 30% tax rate on income from the transfer of Virtual Digital Assets (VDAs), along with an applicable surcharge and a 4% cess.
