The Income Tax Department said on Wednesday that a spelling issue on its website incorrectly changed a 1% tax-deducted-at-source (TDS) amount to 0.1 percent, which has subsequently been corrected.
Fast Facts on the crypto tax typo
- “Some media reports have come to the notice of CBDT (Central Board of Direct Taxes) claiming that the rate of TDS on Virtual Digital Assets (VDA) has been reduced to 0.1%. It is hereby clarified that there is no change in the rate of TDS on VDA, which continues to be 1%,”
- On top of the 30% flat tax on all crypto income that went into effect on April 1, a 1% TDS on cryptocurrency transactions over Rs. 10,000 (about US$129) is expected to go into effect on July 1.
- According to Crebaco analysis, trading volumes at India’s biggest cryptocurrency exchanges fell to their lowest levels in years after April 1.
- A 1% TDS on most transactions starting July 1 is projected to drain liquidity from the market, resulting in a further decline in trade volumes.
- Smaller exchanges, which rely significantly on transaction volumes, are likely to be hit the hardest after July 1, with some of them shutting down.
Source: Yahoo Finanace