India's Crypto Market Braces for Impact: Union Budget Proposes Inclusion of 'Virtual Digital Assets'

The Indian crypto market braced for impact as Union Finance Minister Nirmala Sitharaman proposed including 'Virtual Digital Assets' (VDA) in defining undisclosed income in the latest Union Budget. The crypto community eagerly awaits more clarity around VDA in the fine print set to be released ahead.

India's Finance Minister Nirmala Sitharaman presented the Union Budget 2025 on February 1, sparking a buzz across the crypto market. Although there were no announcements on easing tax policies around cryptocurrencies, the FM suggested that the term "Virtual Digital Asset" (VDA) be included under defining undisclosed income. This proposal has sparked nationwide speculations of a clearer stance on VDA to be revealed in the fine print set to be released ahead.

The crypto market, while awaiting more details, has found slight hope in the FM's comments. According to Indian crypto exchange CoinDCX CEO Sumit Gupta, the fine print of the India Budget 2025 is anticipated to have "more details" regarding VDA. Additionally, Gupta highlighted that Indian businesses must report crypto transactions with a 30-day window to correct errors, as per the new finance bill.

Meanwhile, the latest India Budget also announced zero income tax for up to Rs 12 lakh, a major relief to the nation's broader masses. The Economic Survey presented a day prior to the India Budget 2025 projected a growth rate of 6.3-6.8% for the next financial year, highlighting "Viksit Bharat@2047." This endeavor projects the country as a developed nation by 2025, with an economic growth rate of 8% expected in light of this feat.

As the Indian government continues to supervise the digital assets sector nationwide, possibilities of a less scrutinized approach to taxes prevail. Regulators are expected to establish laws around the sector, primarily mitigating risks and losses for users. Currently, the nation tackles a 30% tax on income from crypto and 1% TDS (Tax Deducted At Source), unchanged from the previous Union Budget. The broader market could substantially be leveraged if Indian tax policies on the sector loosen their grip, potentially leading to a substantial influx of money in the global market.