Budget 2022: Introduction of digital rupee and e-passport help IT stocks gain momentum!

The digital currency by RBI will be based on blockchain technology, the tech behind Bitcoin, and other popular cryptocurrencies. The digital rupee will be issued by 2022-23, which will give a digital boost to the economy

Nifty IT has gained momentum with a few announcements for the technology sector in today’s Budget announcement. At the time of the closing bell, IT stocks such as HCL, Infosys, and Tech Mahindra climbed 3 per cent, 2.1 per cent & 1.8 per cent, respectively.  

Digital currency using blockchain technology  

FM announced that Reserve Bank of India will issue a digital rupee soon. The digital currency by RBI will be based on blockchain technology, the tech behind Bitcoin, and other popular cryptocurrencies. The digital rupee will be issued by 2022-23, which will give a digital boost to the economy. Digital currency will also lead to a more efficient and cheaper currency management system.  

Tax on digital virtual asset  

The government was very quiet on cryptocurrency until now. However, with this move, we can now assume that digital assets have more or less gained acceptance. Around 30 per cent tax on virtual digital assets is to be implemented. This means that you will have to pay taxes on NFT and other virtual tokens based on blockchain technology. Gifting such an asset is also taxable in the hands of the recipient.   

Domestic manufacturing boost for technology  

Duty concessions are given to parts manufacturing of transformers, mobile phone chargers, and camera lens of mobile camera. Custom duty rates have been adjusted to facilitate the manufacturing of wearables, hearable, and electronic smart meters.  

E-passport from FY23  

Today, FM announced that e-passports would be rolled out next year for more convenience to the public. The e-passports will use embedded chips and futuristic technology. The e-passports will have more security features and also, use radio-frequency identification as well as biometrics. The passports will be in line with international rules. The passport jacket will have an electronic chip with security-related data encoded on it.