Ethereum's Ether Faces 30% Tax Rate in India Under New VDA Regime
Ethereum's native crypto-asset, Ether (ETH), is subject to Indian tax laws and regulations despite being operated on a decentralized network. The Income-tax Act, 2025, consolidates and updates India's regime for virtual digital assets (VDAs) from tax year 2026-27 onwards.
The special VDA taxation regime applies to income from transfer of ETH, subjecting it to a 30% tax rate with additional surcharge and health and education cess. This provision overrides more favorable capital gains features available for certain other assets.
A single ETH-linked transaction can involve multiple legal and tax elements, making analysis complex. The type of transaction, capacity in which the assessee acts, instrument involved, and counterparty profile all impact taxation and compliance under Indian law.