Indian Finance Ministry & Central Bank in ‘Complete Harmony’ on Crypto Policy

Indian Finance Ministry & Central Bank in ‘Complete Harmony’ on Crypto Policy

The Reserve Bank of India (RBI) and the Indian Ministry of Finance are in “complete harmony” on cryptocurrency policy, according to the finance minister.

“With RBI and the Ministry, not just on cryptocurrency but on every other thing as well, I think there’s complete harmony with which we are working,” Finance Minister Nirmala Sitharaman said. The finance minister downplayed any concerns of differing opinions between the central bank and the ministry. She added that each has been “respecting each other’s domain, also knowing what we’ve to do with each other’s priorities and in the interest of the nation. There’s no turfing here.”

Meanwhile, RBI Governor Shaktikanta Das also made a statement, confirming that the central bank and the government were discussing cryptocurrency, but that he wouldn’t be able to elaborate on the discussion further.  

Crypto tax

Debate on the legalization of cryptocurrency has intensified since the proposed tax on income from transactions in virtual assets. During her budget address on February 1, Sitharaman announced that any income accrued from the transfer of any virtual digital asset would be taxed at the rate of 30%. During her address, Sitharaman also made it clear a new digital rupee powered by blockchain technology will be issued by the Reserve Bank of India between 2022 and 2023. 

“Digital currency will also lead to a more efficient and cheaper currency management system,” Sitharaman said. “It is therefore proposed to introduce digital rupee using blockchain and other technology to be issued by the Reserve Bank of India starting, 2022 and 2023.”

While this announcement may be encouraging to some, crypto sentiment in the South Asian nation is as tumultuous as the monsoon rains. Despite announcing that the legislation would tax cryptocurrencies, the finance minister later clarified that it would not necessarily legalize them. Last week, Das had argued that cryptocurrencies have no underlying value, “not even a tulip,” which had cast doubts on the cohesion of the country’s crypto policy.

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