Losses in one crypto asset cannot be offset against gains in another: Govt
Crypto losses cannot be offset against gains in another token: Govt
The government on Monday clarified that as per the provisions of the
“Looks to be something new that has turned up Loss incurred in one digital asset cannot be offset against income in another. The government is expecting people to treat each digital asset profit/loss separate,” said Nischal Shetty, CEO of WazirX, a crypto trading platform.
Finance Minister
“As per the provisions of the proposed section 115BBH to the Income-tax Act, 1961, loss from the transfer of virtual digital asset (VDA) will not be allowed to be set off against the income arising from transfer of another VDA,” MoS Finance Pankaj Chaudhary said in a written reply to a question in Lok Sabha.
Related News
India is not a major hub for crypto mining and the provision per se will not majorly impact crypto trading industry in India, said experts. However, the clause pertaining to crypto losses offset was dubbed “unfortunate” by Shetty.
Rohinton Sidhwa, Partner said, ”It’s a continued effort to isolate and disincentivize crypto currency related activities in India. The mining expense disallowance is unlikely to impact the majority of traders, however the prevention of offset between different cryptos will probably negatively impact many traders.”
The crypto industry is concerned that government’s “unfavourable” taxation will lead to migration of investments to other assets such as gold and stocks.
