Pushpendra Singh, Co-Founder of Pushpendra Tech, said that India’s crypto tax regulations are discouraging web3 development and causing developers and capital to relocate.
“India’s tax system is killing web3 innovation,” said Singh. “30% flat tax on crypto gains. 1% TDS on every trade. India needs reform, not exile.”
India’s taxation framework for “virtual digital assets,” which includes cryptocurrencies, involves a flat tax on gains combined with transaction-level reporting through tax deducted at source (TDS). Proponents argue that this structure enhances traceability. However, critics claim it increases costs and limits the treatment of gains and losses, thereby adding friction for active traders and developers.
According to Section 115BBH of India’s Income-tax Act, income from transfers of virtual digital assets is subject to a flat rate on gains with restrictions on deductions. The statute also specifies that losses from such transfers cannot be offset against other income or carried forward, supporting claims about the inability to offset losses.
Section 194S mandates TDS on payments made for the transfer of virtual digital assets, typically at 1% of the transaction value. This creates a withholding mechanism per trade rather than a levy based solely on profits. The Income Tax Department provides guidance on who must deduct this tax, when it applies, and how it should be reported.
Singh is a web3-focused developer and commentator who shares insights on tax and market issues via X. His comments reflect an ongoing industry debate regarding whether high headline tax rates, transaction-level withholding, and limited loss treatment reduce trading liquidity and drive founders to establish projects abroad. Pushpendra Tech is presented online as part of Singh’s personal brand and technology endeavors.
