Indian lawmakers are renewing their calls to legalize cryptocurrencies and other virtual digital assets (VDA) in the country. They have warned that strict taxation without a regulatory framework is pushing capital, startups, and users offshore.
Raghav Chadha, a member of the upper house of parliament, called out the Indian government. He stated that the authorities already treat VDA as legal for tax purposes, but continue to regulate them as if they were illegal.
India holds 30% capital gain tax with 1% TDS on crypto, yet offers no legal recognition, no investor protection, and no dedicated AML (anti-money laundering) framework, he added.
73% of India’s crypto volume moves abroad
During his speech in the Rajya Sabha, Chadha mentioned that the mismatch has created distortions rather than compliance. He cited that around 120 million Indians now trade through overseas platforms, while about ₹4.8 lakh crore in crypto trading activity has moved offshore.
In a post, he highlighted that nearly 73% of India’s crypto trading volume has shifted to foreign exchanges. He added that around 180 Indian crypto startups have relocated abroad. However, Chadha has called for giving VDAs a clear asset-class status under Indian law.
He suggested a domestic regulatory sandbox, along with strong anti-money laundering protection. This could bring activity back onshore. It will also improve investor protection and add an estimated ₹15,000–20,000 crore (approx $2 billion) in annual tax revenue.
“Prohibition is not protection. Regulation is protection,” he stated. Chadha even urged making changes to income tax slabs, public health funding, and state capital expenditure.
CoinDCX founder, Sumit Gupta, in a post stated that he 100% agrees with Raghav Chadha. He added that major economies have expressed intent to make their countries the crypto capital of the world. There is a big need for India to regulate VDAs and bring in friendlier policies.
MP proposes National Blockchain Property Register
The lawmaker also used the budget debate to shed light on the use of blockchain in public administration. He talked about land and property records and highlighted how India’s land registry system remains prone to disputes. This creates delays and encourages informal practices in the system.
Chadha cited official data showing that land disputes account for about 66% of civil cases in India, while around 45% of properties lack a clear title. Meanwhile, nearly 48% are already under dispute. He added that India ranks 133 out of 190 countries in property registration efficiency.
He marked that even a simple property sale can take 2 to 6 months, and when disputes arise, civil courts take 7 years on average to resolve them. The MP claims that 6.2 crore property documents are still pending digitisation, and this adds to the administrative backlogs.
Chadha proposed a National Blockchain Property Register that would be time-stamped, tamper-proof, and fully transparent. It will allow the officials to track ownership changes, inheritance, and mutations.
He added that countries such as Sweden, Georgia, and the United Arab Emirates have already experimented with blockchain-based land registries. The move has reduced transaction times and dispute rates, he said.
Beyond crypto and blockchain, Chadha also called for eliminating long-term capital gains tax on equities for individual investors. He said the recent increase in the securities transaction tax on derivatives could help curb excessive speculation, noting that nearly 90% of retail investors lose money in futures and options trading.
Source: https://www.cryptopolitan.com/30-crypto-tax-zero-legal-status-indian-law/
