5 Key takeaways for the FinTech industry from Union Budget 2022
By Leandra Monteiro
Finance Minister Nirmala Sitharaman presented the Union Budget 2022-23 in Parliament on the 1st of February. Speaking at a press conference post presenting the Union Budget, Sitharaman said the government took a mindful decision not to increase taxes due to the hardship faced by people during the pandemic.
The budget present by Sitharaman focused on four pillars of development — inclusive development, productivity enhancement, energy transition and climate action. The Budget gives a blueprint of economy from India at 75 to India at 100.
Here are 5 key takeaways for the FinTech industry:
- The finance minister announced that using Blockchain technology, a digital rupee, would be issued by the Reserve Bank of India starting 2022-23.
- 30% tax will be levied on cryptocurrencies irrespective of short term or long term holdings. It was also proposed that any income from transfer of any virtual digital asset shall be taxed at the rate of 30%.
- Also in order to capture the transaction details, it was proposed to provide for TDS on payment made in relation to transfer of virtual digital asset at the rate of 1% of such consideration above a monetary threshold.
- The budget proposed to set up 75 Digital Banking Units (DBUs) in 75 districts. All post offices of the country will soon connect to the core banking system, to improve financial inclusion.
- On digital payments, Sitharaman emphasized that the financial support for digital payment ecosystem announced in the previous years Budget would continue in 2022-23. she said, “This will encourage further adoption of digital payments. There will also be a focus to promote use of payment platforms that are economical and user friendly.”
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