New Enroll in RBI Grade B New Batch - Starts on May 21

    Question

    Which of the following statements is not correct

    regarding crypto or digital-assets regulations in India?
    A The government in the Union Budget 2022-23 has for the first time provided taxation on crypto-assets. Correct Answer Incorrect Answer
    B Income from the transfer of virtual digital assets or cryptocurrencies is taxable at 30 percent. Correct Answer Incorrect Answer
    C Crypto trading platforms are regulated by the RBI under the Foreign Exchange Management Act (FEMA). Correct Answer Incorrect Answer
    D 1% TDS (tax deducted at source) is also applicable on payments made on the transfer of digital assets. Correct Answer Incorrect Answer
    E None of the above Correct Answer Incorrect Answer

    Solution

    It is the suggestion of the Securities and Exchange Board of India (SEBI) to regulate crypto trading platforms by the RBI under the Foreign Exchange Management Act (FEMA). (Statement c is incorrect). Position of the Indian government on Cryptocurrency: Definition for crypto assets: The government in the Union Budget for 2022-23 has for the first time provided a definition for crypto-assets and set out a list of proposals on the taxation of this new asset class. Coverage: The tax proposal covered all emerging digital assets, including non-fungible tokens (NFTs), assets in the metaverse, digital currencies and tokens, among others. Tax deducted at source: The Budget also said a 1% TDS (tax deducted at source) will be applicable on payments made on the transfer of digital assets. Loss from the transfer of virtual digital assets - It will not be allowed to be set off against the income arising from the transfer of another VDA in the proposed amendments. 30 percent tax on income: The government will define virtual digital assets with a view to levying a 30 percent tax on income from all transfers of such assets.

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