The crypto community is disappointed with no tax burden and TDS reduction announced by India’s Finance Minister Nirmala Sitharaman in the first session of the Union Budget 2023. The Minister of Finance announced significant tax rate changes, which reduced the amount of tax payable under the new system.
Income tax modifications announced in Budget 2023.
In the 2023 budget, Indian Finance Minister Nirmala Sitharaman said that the "new tax system" will henceforth be the default scheme. Nirmala sitharaman has announced significant income tax changes that would benefit people and help in the current inflationary environment.
Under the new income tax system, the maximum amount of income tax refunds is reduced from 5 lakh to 7 lakh. The government has also extended the benefits of the standard deduction to the category of employees and retirees. The new system has the following tax rates:
- Tax for income of Rs 0-3 lakh is nil
- Income above Rs 3 lakh and up to Rs 5 lakh is to be taxed at 5%
- Income of above Rs 6 lakh and up to Rs 9 lakh is to be taxed at 10%
- Income above Rs 12 lakh and up to Rs 15 lakh is to be taxed at 20%
- Income above Rs 15 lakh is to be taxed at Rs 30%.
India's finance minister says changes are being made to the income tax system to ease the burden on the middle class. However, there are many who say that the development budget is aimed at the upper class, which stimulates consumption and stimulates growth. In addition, the conditions of the new tax system have created an incentive for people to move away from it earlier and stick to the old tax system.
Are these tax changes good for India's crypto community?
While the Indian crypto community was expecting a 30% reduction in crypto taxes and a 1% reduction in income tax, the increase in the income tax refund limit gave some relief to the crypto community. The community already knew that the government would not be able to revise the cryptocurrency tax policy this fiscal year.
Young people and people with financial knowledge in India invest only in cryptocurrencies, which are generally subject to higher rates of taxation. Moreover, proof-of-reserves (PoR) reports by CoinDCX and WazirX have revealed that Indian investors are mostly investing in crypto such as Shiba Inu, Dogecoin, and Polygon (MATIC), which have low prices. Only a few people are investing in Bitcoin and Ethereum.
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