India To Launch Blockchain-Based Digital Currency By 2023
India has announced plans to launch a blockchain-based digital currency and tax crypto assets as the nation moves to keep pace with the global shift toward virtual financial instruments.
The move by India was prompted by the country’s rapid adoption of digital coins, bringing it closer to regulating such investments following several warnings about the risks of terrorism and money laundering from the central bank. The move also follows China beginning CBDC trials in numerous cities, while the US Federal Reserve and the Bank of England are exploring possibilities for their economies.
On Tuesday, Finance Minister Nirmala Sitharaman said in her budget speech that income from the transfer of any digital assets will be taxed at 30%.
“There’s been a phenomenal increase in transactions in virtual digital assets,” Sitharaman said. “The magnitude and frequency of these transactions have made it imperative to provide for a specific tax regime.”
Sitharaman also announced the launch of a central bank digital currency for the financial year beginning in April, to attract more efficient and more affordable currency management.