The introduction of high taxes in India has obviously led to traders transferring their cryptocurrencies abroad. Esya Centre analysis shows that in the period from February to October 2022, Indian crypto exchanges transferred $3.9 billion in digital funds to foreign trading platforms. At the same time, the customer base of Indian platforms decreased by 1.7 million people. This negative trend is explained by the short-sighted approach of lawmakers, who on April 1 adopted a 30% tax on profits from the sale of virtual currencies and an additional 1% tax on transactions with digital assets, which led to the withdrawal of cryptocurrency on foreign exchanges in the amount of about $ 3.05 billion. After July 1, when the transfer tax on virtual currencies went into effect, trading volume dropped 81%. According to the experts of the Esya Centre, the current legislation on taxation of digital assets could lead to the loss of about $1.2 trillion in trading volume on local exchanges over four years. They propose to change the rules regarding progressive taxes on cryptocurrency trading and set them based on the period of storage of digital resources.
