Stakeholders argue that reducing TDS from 1% to 0.01% would provide competitive prices to India's virtual currency users and safeguard them from unregulated foreign exchanges.
India's Prime Minister Nirmala Sitharaman said that the reason for the government's apathy towards blockchain hinges on the fact that only a few financial institutions are using the tech.
India's finance minister disclosed at the Indian Council for Research on International Economic Relations that regulating digital assets forms part of its core objectives under its G20 presidency.
India will lead the G20 for a year and other issues it will tackle include food security, climate financing, multilateral reforms, and disaster risk reduction.
India recognizes the benefits of the digital asset sector but says a tech-driven framework needs to be crafted to ensure that technology in the industry will not be misused.
Amid its tumultuous ties with digital assets, India is positive that the public and private sectors will embrace the use of distributed ledgers in the future as it transitions into a digital society.
The finance ministry does not support RBI's plan to ban digital assets because a decision to ban them will only be effective if there is international collaboration due to their borderless nature.
The Indian Parliament passed the Finance Bill 2022-2023, which confirmed the 30% tax rate on all virtual digital assets (VDAs) that will take effect from April 1 in addition to other regulations.
Aditya Singh, founder of the YouTube channel "Crypto India," started a petition against the 30% digital currency tax rate, which 60,000 people have signed at the time of writing.
India's Finance Minister Nirmala Sitharaman will read the budget on February 1, and many are hopeful that she'll talk digital currency regulations, but it's unlikely with elections on the way.
The Reserve Bank of India still maintained its stance that digital currencies can lead the country into financial stability, even though it plans on launching its own digital currency.