The crypto sector anticipates a reduction in the tax deducted at source (TDS) rate on virtual digital assets (VDAs) from 1% to 0.01% in the upcoming Budget. Industry voices also call for permission to offset and carry forward losses from VDA sales. Since July 1, 2022, the transfer of VDAs, including cryptos, has incurred a 1% TDS under section 194S of the Income Tax Act. A report from the Esya Centre suggests that the 1% TDS has prompted 3-5 million users to shift to offshore platforms, resulting in a revenue loss of Rs 3,493 crore against collected revenue of Rs 258 crore. Exchanges like WazirX advocate for loss offsetting to ensure a level playing field, emphasizing the need for regulatory fairness in the crypto space.
Crypto Industry Advocates for Reduced TDS and Loss Offset in Budget, Citing Revenue Impact
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