Economy News

Government obtains ₹60.46 crore tax from TDS on virtual digital assets – Mintpaisa

The government said on Tuesday that ₹60.46 crore had been received in entity tax for transactions in virtual digital assets (VDAs), including cryptocurrencies, since the introduction of TDS provisions in July.

The government, from April 1, had introduced a 30% income tax plus a surcharge and tax on the transfer of crypto assets, such as Bitcoin, Ethereum, Tether, and Dogecoin.

Additionally, to keep an eye on the money trail, a 1% withholding tax (TDS) under Section 194S of the IT Act had been introduced on payments exceeding ₹10,000 to virtual digital currencies from July 1.

In a written response to a question posed to the Rajya Sabha, the Minister of State for Finance, Pankaj Chaudhary, said that the CBDT was carrying out sensitization/sensitization programs for deductors/taxpayers and also taking appropriate measures including search and seizure operations, inquiries, investigations, etc., as required.

“Following the insertion of Section 194S into the Income Tax Act 1961 through the Finance Act 2022, a total of 318 direct tax applications bearing the TDS code 194S were received for a total amount of Rs 60.46 crore,” Mr Chaudhary said.

Under the Income Tax Act 1961, Section 194S was inserted into the Finance Act 2022 for the withholding tax deduction in respect of the transfer of VDA, which must be complied with by anyone engaged in VDA-related transactions.

The Minister further stated that currently, crypto assets are unregulated in India and the government does not register foreign crypto exchanges.

“Crypto-assets are by definition borderless and require international collaboration to prevent regulatory arbitrage,” he said.

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