Indian Terra Holders Hit Hardest By Crash As Airdrop Is Taxed At 30%
Terra coin holders in India faced a “double whammy” following the collapse of LUNAC and UST last month and could be hit with 30% tax bills due to the recent LUNA 2.0 airdrop. The airdrop took place on May 30th when new tokens known as LUNA were distributed among holders. However, investors in India were less fortunate than others due to the new tax regime that came into effect in April.
Although the text of the law does not specifically address airdrops and contains "vague" definitions, Jay SAYTA, a tech and gaming lawyer, said it is this ambiguity that could play into the hands of the tax authority. The lawyer added that tax inspectors will consider any distribution of coins as income that is subject to taxation.
An Indian crypto tax advisor has stated that an airdrop may meet the current definition of gifts, meaning that the 30% flat tax may not apply in this case. However, since gifts are subject to income tax, holders still have to pay tax even if they manage to avoid the 30% tax.
Image: Analytics Insight
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