Govt Collected ₹5.1 Billion TDS On Crypto Transactions In FY25: Report

(MENAFN- Live Mint) The government has collected ₹5.12 billion as tax deducted at source (TDS) during 2024-25 (Apr-Mar) on transactions involving cryptocurrencies and other virtual digital assets, Minister of State for Finance Pankaj Chaudhary said on Monday.

The government imposes a flat 30% tax on profits earned from cryptocurrency transactions; it also levies a separate 1% TDS on the transaction value each time a digital asset is bought or sold.

The 1% TDS helps the tax department track transactions, while the 30% tax applies only to the gains made from them.

How much TDS did government collect?

The TDS collected on such transactions jumped up 41% in FY25, from ₹3.63 billion in FY24, according to Chaudhary's written response to a question raised in the Lok Sabha.

Among Indian states with the highest cryptocurrency activity, Maharashtra and Karnataka together accounted for over 80% of crypto transactions, with state-wise TDS collection of ₹2.93 billion and ₹1.34 billion, respectively.

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The government has not carried out any studies for the implementation of taxation models for cryptocurrencies, as in other countries such as Thailand and Indonesia, Chaudhary said.

To ensure anti-money laundering and counter-terrorism financing through these assets, the Financial Intelligence Unit registers all Virtual Asset Service Providers under the Prevention of Money Laundering Act, Chaudhary said.“This registration requirement applies equally to domestic and offshore platforms that cater to users based in India,” he added.

Is crypto regulated in India?

The government and the Reserve Bank of India (RBI) classify cryptocurrencies as“virtual digital assets” rather than legal tender. While the government has not banned crypto, it remains largely unregulated, with limited oversight and taxation.

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Just last week, the Directorate of Revenue Intelligence (DRI) said that stronger regulatory frameworks, advanced forensic tools and global cooperation are required to curb the misuse of digital assets. This came as cryptocurrencies are increasingly being used for smuggling and money laundering, Mint reported earlier.

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