No Relief For Crypto Investors As India Retains Current Crypto Tax In Budget 2026
India will maintain its stringent crypto tax regime, keeping the flat 30% tax on digital asset income and 1% TDS for every transaction unchanged, as per the latest Union Budget by Finance Minister Nirmala Sitharaman. This decision disappoints industry participants, as these policies have pushed about 75% of India's $6.1 billion crypto trading volume to offshore platforms. Investors remain unable to offset crypto losses against other income, and the high TDS discourages high-frequency trading on Indian exchanges. The government is focusing on enforcement and compliance over tax policy revision, coordinating with G20 partners on regulatory frameworks before considering changes. One notable relaxation reduces maximum imprisonment for TDS defaults from seven to two years, with the possibility of monetary penalties instead. However, new penalties for non-compliance with transaction-reporting requirements have been added, including daily and lump-sum fines. The government frames current taxation as a temporary measure pending comprehensive crypto regulations, emphasizing compliance while working toward future regulatory clarity.
