Investing in crypto was all the rage in India up until early 2022, as millennials made a beeline to be a part of the new financial sector. The Economic Times reported that around 20 million Indians hopped on the crypto bandwagon in 2021. Just when the crypto market was booming in India, the government introduced a 30% tax on cryptos with an additional 1% TDS. Add to that, investors can’t offset their losses but are allowed in the stock market (Sensex and Nifty). Investors feel the 30% tax is draconian which is stealing money from the average man trying to make a buck.
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To add to the burden, banks disabled UPI payment services to crypto apps making it impossible to purchase coins easily. UPI is the most preferred form of payment in India as it’s seamless and transactions happen swiftly. The disabling of UPI paves way for P2P services, which require more time and effort for payments to go through. Naturally, the government and banks in India kept the crypto market in ICU with their moves.
Watcher Guru reached out to crypto investors in India to know the pulse of the average investor. Sadly, everyone is unhappy with the 30% tax, 1% TDS, and disabling of UPI payment services. However, what hurt them the most is not the taxes, but their dreams falling apart.
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Here’s What Crypto Investors in India Feel About the Taxation
Jaya Prakash, working in a private firm in India’s financial hub Mumbai, spoke previously to Watcher Guru in January. Back then, Prakash was thrilled about how cryptos could earn him enough money to buy an apartment in Mumbai.
He previously revealed that he wants to make his mother’s dream of owning a house come true, as they’ve stayed in a rented apartment all their lives. You can read Prakash’s excitement about how cryptos can help him achieve his dream here.
Fast-forward to April, Prakash’s enthusiasm has dipped as he now believes it is impossible to buy a home in Mumbai. The 31-year-old stated that the 30% tax has damped his hopes and is next to impossible to buy an apartment. He revealed even if his portfolio moons, the tax will wipe away his profits making it hard to even buy a 1-bedroom apartment.
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For the uninitiated, owning a house in Mumbai is the dream of millions, and the cost has hit the ceiling. The average Joe ends up slogging for years and still not being able to afford to buy a house in the city.
“Crypto was the only hope for me to buy a house in the long run but that’s now gone. I didn’t see any other avenues that can generate profits like how cryptos do and I bet my money on it. Even if my portfolio rises in the future, a portion of it will go to taxes. I cannot afford a home with the rest. I don’t see any other option to make big money and it’s heartbreaking to see my dreams not come true,” said Prakash exclusively to Watcher Guru.
The Mood Isn’t the Same Anymore, Says An Investor
Arvind Varrier, a marketing manager in Bangalore revealed that the positive mood has turned sour. “I used to wake up and think which coin should I invest today and look at news about its predictions. I ended up making both profits and losses but the sentiment was mostly positive. The new tax rule sucked out all the air and it is been more than a month since I purchased anything.”
When question if he plans to buy cryptos again, Varrier said, “no”. When asked why he revealed “what’s the point? I don’t want to trade and then pay 30% in tax. It’s ridiculous,” he summed it up exclusively to Watcher Guru.