The post Budget 2024: Angel-Tax Abolished For All Tax Classes; Crypto Tax Remains Unchanged By Nirmala Sitharaman appeared first on Coinpedia Fintech News
Finance Minister Nirmala Sitharaman presented the first budget of Modi 3.0, setting the stage for development and opportunities. Sitharaman announced a comprehensive review of the Income Tax Act, 1961, aiming to make it concise, lucid, and easy to understand, reducing disputes and litigation to provide tax certainty. This review is proposed to be completed in six months.
However, the rules for one sector remained unchanged and that is the controversial cryptocurrency sector. For the crypto industry, TDS is a key issue. The Bharat Web3 Association (BWA) has been requesting a reduction of the tax from 1% to 0.01% since it was introduced two years ago.
Dilip Chenoy, Chairperson, Bharat Web3 Association told Coindesk,
“We were hoping for some relaxation to the taxation framework on VDAs (Virtual Digital Assets) in this budget, but the absence of any announcement is not particularly disheartening, given the Govt’s overall negative stance towards the sector,”
Several proposals to promote investment and foster employment include abolishing the angel tax for all classes of investors. Sitharaman said,
“I have a few proposals to promote investment and foster employment. First of all, to bolster the Indian startup ecosystem, boost the entrepreneurial spirit, and to support innovation, I propose to abolish the so-called Angel tax for all classes of investors.”
Capital gains taxation will also see simplification under the new regime. Short-term gains on certain financial assets will attract a 20% tax rate, while long-term gains on all financial and non-financial assets will be taxed at 12.5%.
The exemption limit for capital gains on certain financial assets will increase to ₹1.25 lakh per year. Listed financial assets held for over a year will be classified as long-term, while unlisted financial assets and non-financial assets will need to be held for at least two years.
Additionally, the 20% TDS rate on repurchase of units by mutual funds or UTI will be withdrawn, and the TDS rate on e-commerce operators will be reduced from 1% to 0.1%. Credit of TCS is proposed to be given in the TDS deducted on salary, and delays in TDS payment up to the due date of filing the statement will be decriminalized.
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