The government is considering amendment in the current income tax and disclosure norms in the upcoming budget to include terms such as cryptocurrency, reports Economic Times.
With the proposed amendment in the tax laws, Indians who trade or invest in cryptocurrencies on Indian platforms could reportedly come under the taxman's lens, as might those who hold such digital assets outside the country
The government wants to capture cryptocurrency income and investments within and outside India, people aware of the development were cited in the report as saying.
The Centre is likely to amend the Section 26A of the Income Tax Act and the Annual Information Regulation (AIR), which shows data on all investments made by a taxpayer and is often called a 'tax passbook'.
"There is a recommendation to add the words cryptocurrency, crypto assets or digital currency in some parts of the Income Tax Act," one of the persons was quoted in the report as saying.
"This would mean that those filing tax returns will have to specifically disclose their income from cryptocurrency investment or trading," the person added.
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