The Central Board of Direct Taxes (CBDT) Chairperson, Nitin Gupta said on Tuesday that during Apr-Sep 2023, the Income-tax Department has collected TDS of ₹600 crore from online gaming and ₹105 crore from trading of cryptocurrencies.
Streamlining Tax Collection in the Online Gaming Sector
The Indian government has made significant changes to streamline tax collection from the online gaming sector. The threshold for the applicability of TDS on online gaming winnings has been eliminated, and now all online gaming winnings are subject to a 30% TDS. However, players with net winnings below ₹100 are exempt from TDS.
Virtual Digital Assets Contributing to Tax Collections
Currently, income generated from the transfer of virtual digital assets like cryptocurrencies and non-fungible tokens (NFTs), is subject to a tax rate of 30%. This tax applies even if a taxpayer's total income falls below the threshold limit of ₹2.50 lakh. Moreover, no deductions, other than the cost of acquisition, are allowed while calculating the taxable amount.
Growth in Tax Collections Anticipated
The Government has kept a strong vigil on the income from virtual world sectors like online gaming, virtual digital asset transactions, and income generated by influencers. The tax collections are expected to grow further as the Government continues to enforce and encourage tax compliance among these sectors.
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