FM Sitharaman says taxing crypto doesn't mean legitimacy; 'Will decide after consultation'

The taxing of cryptocurrency does not mean its legitimacy, Finance Minister Nirmala Sitharaman had told Republic Media Network's Editor-in-Chief Arnab Goswami in an exclusive conversation. She had also stated that crypto coins such as Ethereum, Bitcoin and NFTs will never become legal tender.

When asked whether the taxation is an implicit legitimisation of crypto, Sitharaman explained, "The question of the legitimacy of digital assets has yet not been broached. Now we are only taxing, beyond this we will decide on regularisation or ban only after the consultations are over."

Finance Minister Sitharaman said that she does not see any currency outside the domain of sovereign. "Therefore, if anything develops digitally outside, I refrain from calling them currency," she said.

The Finance Minister added that currency is the domain of the government or the authorised central bank. The Union Minister also informed that taxing operates on any kind of product for a profit. "There is a tax which has been labelled for transactions emerging out of digital operations, and we have also put a TDS on them. That is where we are."

Discussions with RBI on crypto, digital currency: Sitharaman

On Monday, Nirmala Sitharaman said that discussions are on with the Reserve Bank of India (RBI) on private cryptocurrency and central bank-backed digital currency (CBDC) and a decision will be taken after due deliberations.

In her budget speech, Sitharaman had announced that Digital Rupee would be issued by the RBI in the coming fiscal. She had announced that about 30% tax will be levied on gains made from any private currencies. 

"On crypto, I have said that we are in the process of consultation. Whatever decision the government is going to take, will be after the consultation," she said.

Last week, Union Minister of State (MoS) for Finance Dr Bhagwat Krishnarao Karad had also said that cryptocurrencies are not legal in the country and nothing could be said about what will happen in the segment in future.

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