The Union government and the Reserve Bank of India (RBI) are in "complete harmony" on cryptocurrencies and other issues as well, said Finance Minister Nirmala Sitharaman on February 14.
Speaking to reporters at the conclusion of the RBI's board meeting, the finance minister said talks were on with the central bank on the matter prior to the budget and are continuing.
"Whatever the government does, we consult and have discussions with the RBI. So if I were to tax 30 percent and then discuss Goods and Services Tax (GST) and everything else, I would be tying RBI's hands if I hadn't even talked to them!" Sitharaman said.
"So, with the RBI and the ministry, not just on crypto but on every other thing as well, I think over the last few years you would have noticed that there is complete harmony with which we are working. We respect each other's domain and know what we have to do with each other's priorities," she added.
"There is no 'turfing' here."
The budget for FY23 proposed a 30 percent tax on profit made from the sale of all crypto assets, with a 1 percent tax deducted at source on all such transactions. This led to speculation that the government had effectively legalised them, which would have contradicted the RBI's stance that cryptocurrencies would never be legal tender.
Since then, Sitharaman has clarified that while placing a tax on cryptocurrencies was a "sovereign right", they had not been legalised.
In her comments today, the finance minister said the government was keeping the RBI informed through its discussions with the central bank.
On his part, RBI Governor Shaktikanta Das said the issue was being discussed internally.
"Whatever points we have, we discuss with the government. Beyond that I would not like to further elaborate," Das said.
The RBI governor has come out hard against cryptocurrencies over the last year or so. More recently, in his post-policy media briefing on February 10, Das was withering in his assessment of private cryptocurrencies, saying they had no underlying asset, "not even a tulip".
The central bank is currently working on its own digital currency, with the Finance Bill, 2022 making a provision for the same.
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