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Economy
Mahesh

10/03/23 08:41 AM IST

Ministry brings crypto assets under Prevention of Money Laundering Act

In News
  • The Union Finance Ministry’s move to bring in virtual digital assets under the money laundering law is aimed at widening the taxation and regulatory net and giving teeth to agencies.
Significance
  • The measure is expected to aid investigative agencies in carrying out action against crypto firms.
  • These include an exchange between virtual digital assets and fiat currencies, between one or more forms of virtual digital assets, transfer of virtual digital assets, safekeeping or administration of virtual digital assets or instruments enabling control over such assets, and participation in and provision of financial services related to an issuer’s offer and sale of a virtual digital asset.
  • From April 2022, India introduced a 30 per cent income tax on gains made from cryptocurrencies.
  • In July 2022, rules regarding 1 per cent tax deducted at source on cryptocurrency came into effect
About VDA
  • According to the Finance Act, a virtual digital asset means any information or code or number or token (not being Indian currency or any foreign currency), generated through cryptographic means or otherwise.
  • The definition includes non-fungible tokens (unique and can't be replaced with something else) as well as other tokens of a similar nature.
  • It provides a digital value that is exchanged for, with the promise of having inherent value or functions as a store of value or a unit of account and includes its use in any financial transaction or investment.
  • This means, it is not limited to investment schemes and can be transferred, stored or traded electronically.
Source- Indian Express

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