As the Union Budget 2026 draws closer, India’s cryptocurrency and Web3 sector is renewing its call for regulatory clarity and tax rationalisation, warning that the current framework continues to restrict liquidity and investor participation.
🔍 At the heart of the demand is the 1% TDS on crypto transactions, which industry leaders say drains trading volumes and discourages onshore activity. The sector is also seeking a review of the flat 30% tax on Virtual Digital Asset (VDA) gains, introduced when cryptocurrencies were formally recognised in Budget 2022.
📜 Under the Income Tax Act, Sections 115BBH and 194S govern VDAs such as cryptocurrencies, NFTs and digital tokens. While the framework brought legal recognition, stakeholders argue it has failed to evolve with market realities.
🗣️ What Industry Leaders Are Saying
🔹 Raj Karkara (ZebPay) called Budget 2026 a turning point, saying a consistent regulatory framework would strengthen trust among investors and institutions. He stressed that easing TDS and allowing loss set-offs, in line with other asset classes, could significantly boost liquidity.
🔹 Nischal Shetty (WazirX) said the budget offers a chance to fine-tune rules that balance compliance and innovation, adding that lower transaction taxes could revive domestic trading while improving regulatory adherence.
🔹 Pankaj Balani (Delta Exchange) urged policymakers to adopt a ‘Make in India’ approach, backing compliant domestic platforms that follow KYC, AML, capital control and data protection norms, while acting firmly against unauthorised offshore players.
🔹 Sumit Gupta (CoinDCX) highlighted that it has been four years since the current tax regime was introduced, noting that clearer rules and uniform TDS implementation could accelerate innovation and consumer protection.
🔹 SB Seker (Binance APAC) said India’s rapid VDA adoption reflects the scale of its digital economy, and the upcoming budget is an opportunity to support responsible market growth without compromising financial stability.
🚀 The Big Picture
Industry voices agree that measured tax relief and regulatory clarity could unlock innovation, revive onshore liquidity, and position India as a global Web3 and digital asset leader—making Budget 2026 a defining moment for the country’s crypto ecosystem.
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