• India’s Finance Minister had announced a 30% tax on all crypto income, including NFTs

• JB Mohapatra, chief Tax, says that the step does not equate with legalizing crypto trading within the country.

Tuesday’s budget speech by India’s Finance Minister Nirmala Sitharaman included a provision for a 30% tax on crypto income, prompting reactions from across the crypto community that the country had signaled recognition for crypto assets.

But in a statement after the budget speech, JB Mohapatra, chairman of Central Board of Direct Taxes(CBDT), stated that his view might be incorrect.

According to the CBDT boss the move by the finance ministry to tax cryptocurrency should not be taken as a sign that trading in digital assets is legal.

He stated that taxing crypto trades in the new laws does not have any connection with their legality.

Crypto “does not ipso facto become lawful or regular simply because you have paid taxes,” Mohapatra stated in the interview.

He said that the tax reforms increase the tax bracket, giving the taxman more options to catch potential cheats or other illegal activity.

Despite the obvious benefits, he said that only a properly regulated framework for cryptocurrencies can determine the legality of trading the asset class.

India plans to launch its central bank digital currency within the next one-two years. It also intends to regulate private cryptocurrencies.