India's finance minister, ,Nirmala Sitharaman, announced on Tuesday a 30% "crypto tax" - tax on the income from the transfer of any virtual digital assets-, and the plans to launch India's official digital currency (CBDC).
The announcement comes at a time when trading in cryptocurrencies and NFTs is booming in India despite the uncertainty of regulations in the country.
"There has been a phenomenal increase in transaction in virtual digital assets. The magnitude and frequency of these transactions have made it imperative to provide for a specific tax regime," Sitharaman said in the critical Indian budget speech, which lasted for over two hours.
Sitharaman also said that the nation's central bank, the Reserve Bank of India (RBI), will launch a CBDC in the the financial year starting April, using blockchain and other supporting technology.
“Introduction of a central bank digital currency will give a big boost to the digital economy,” said Sitharaman.
“Digital currency will also lead to a more efficient and cheaper currency management system.” She added.
It's worth noting that there are nine countries that have officially launched their own CBDCs, and these are: Nigeria, The Bahamas, Antigua and Barbuda, Saint Kitts and Nevis, Montserrat, Dominica, Saint Lucia, Saint Vincent and the Grenadines, and Greneda. While 14 countries are still in the pilot phase, and among those 14 countries are the United Arab Emirates, Saudi Arabia, and China.
