As we are approaching the 1st of April, the chaos of Indian crypto taxation is increasing and the community is seeking more clarification. As we know that Indian govt has announced crypto tax in Feb month during the budget session and as per the budget guidelines this will be effective on 1st April 2022 however till now no tax document or clarification is provided by the government. Now one of the topics is getting discussed in social media about crypto taxation and it's about loss set off. In any business if we face loss then we can set off the same with another business; if any and thereafter tax liability is calculated. Even the cost of running a business and some other related expenses are considered but here in the crypto things are completely different.

![image.png](https://images.hive.blog/DQmcj1FKQQEV4wxHKTYWemwYqg7wnyYr4buk7wQyDFigcNo/image.png)

[src](https://images.app.goo.gl/LzWprLr7cVGxVzsC8)

I did some articles and posts on social media about the same topic and tried to understand more of this part in the crypto tax. As per the new rule, even the miners would not be able to set off their mining cost including hardware, electricity, etc and they would have to pay the 30% of whatever they earn and this is a matter of concern. Miners earn crypto through mining but it requires an expensive setup and recurring high electricity costs. Making them pay 30% of whatever they mine without considering their expenses is going to make their life tough and will drastically reduce their earnings.



It's not about just the miners but is also applicable for traders and there are possible scenarios where traders will end up losing money with trade instead of earning and if this happens then it's going to affect the crypto growth in the country. 

Here is one of the tweets shared by the wazirX exchange founder and he tried to explain through the example. As per the example if we invest INR 100 each on two coins and our total investment is INR 200. We make INR 100 profit on one coin and lose INR 100 on another but we also need to pay 30% on the income. After paying the tax we are left with 170 INR only whereas we had invested INR 200 in total. So in this case govt has earned INR 30 but we have lost INR 30 because we are not allowed to offset the loss against another crypto. 

![image.png](https://images.hive.blog/DQmQGNYdSYsbzBJ7WG9p4Eb1R7hiTxW1HH2JNEN4oWgP92F/image.png)

[tweet link](https://twitter.com/NischalShetty/status/1505856052914442244?s=20&t=kIOo--iz0XuKzN0zoAc6Nw)

This is not good for crypto because in any case only govt will earn and the trader will lose money because of the type of tax and TDS involved with the transaction. I don't think that this is a reason to be happy that govt has taxed the crypto instead it's way to killing the growth of blockchain and crypto industry which should not be the case. 

![image.png](https://images.hive.blog/DQmdD7A7G7FouE5UXGt9HmUaKxAmea5oik7qpKcqE1m2Cp7/image.png)

[src](https://images.app.goo.gl/HPrTjtfMNb4swxsZA)

I hope the govt pay attention to this and bring some amendment to make it friendly else it's going to cost a lot to the industry and for sure the growth will b stopped. 

**thank you so much**

*Stay Safe*




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