CBDT Reopens Crypto Law Talks: What India’s Next Tax Rules Could Mean

India’s crypto community is once again watching closely as the Central Board of Direct Taxes (CBDT) reopens discussions on tax rules for digital assets. Ever since the 30% flat tax on profits and 1% TDS on transactions came into effect, trading activity in spot markets has slowed down. With talks back on the table, traders, exchanges, and even small-town investors are hopeful that new measures could bring clarity and ease.

One of the biggest issues has been the 1% TDS deduction on every trade. For active traders, this rule eats into capital and discourages frequent buying and selling. Many moved to futures or even international platforms to avoid these deductions. Now, with CBDT revisiting the framework, there is speculation that the government may consider changes to make taxation less restrictive.

Industry voices argue that lowering TDS could revive participation in the Indian market. Reduced deductions would not only keep liquidity within the country but also allow small investors from Tier 2 and Tier 3 cities to trade more freely without worrying about their funds being locked. Exchanges have also stressed that simpler rules could boost transparency and compliance.

At the same time, the government remains cautious. Tax on profits is unlikely to change as it aligns with the current approach of treating crypto as speculative. The focus, therefore, may be on transaction-level rules and reporting requirements. Officials are balancing between preventing misuse and supporting genuine innovation in the sector.

For retail investors, the outcome of these talks could shape how they approach crypto in the near future. If rules ease, more participation from smaller towns can be expected, as digital assets are already popular among youth seeking alternative investment avenues. If not, traders may continue shifting to global exchanges or less-regulated platforms.

The reopening of crypto tax discussions signals that the government is aware of the market’s concerns and the challenges of the existing framework. Whether this leads to meaningful change or just minor adjustments remains to be seen, but for India’s growing crypto user base, it is a chance to hope for a more balanced approach that encourages both compliance and growth.