How Much Bitcoin Do You Need To Buy Thar Roxx, Fortuner, Defender?

If buying a swanky car using gains made through cryptocurrencies is on your bucket list, then you might want to think it over once more. That is because making such a move could cost you lakhs of rupees in profit that would have otherwise continued to grow in your digital wallet. Here is a quick breakdown on why buying your dream car using cryptocurrency sounds more attractive than it actually is.

For this explainer, let's assume you are a Bitcoin investor who is looking to buy one of the top-selling lifestyle SUVs in the country, including the Mahindra Thar Roxx, Toyota Fortuner and Land Rover Defender. Based on these car models, the buyer stands to lose between Rs 8.5 lakh to Rs 33.6 lakh if purchased using Bitcoin.

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How Much Bitcoin Do You Need?

Currently, the value of 1 Bitcoin is around Rs 1.03 crore. This means, to bring home a Thar Roxx top-variant worth Rs 23.39 lakh ex-showroom, you would need at least 0.23 Bitcoin. Similarly, buying a Fortuner would set you back by 0.51 Bitcoin and a Land Rover Defender would cost you well over one whole Bitcoin, just to cover the ex-showroom costs.

What You Have Not Considered Yet:

When using INR, a person purchasing a new car only needs to consider the ex-showroom cost plus RTO charges and Insurance cost to come up with a final on-road price. However, it won't be that simple if you are a 'Crypto Bro' because you still don't hold any real cash, your car kitty is still Bitcoin or any other cryptocurrency.

How Do You Convert Crypto To Cash:

To convert your cryptocurrency into INR, you would first head to a crypto exchange portal such as CoinDCX, CoinSwitch, Binance or others. At this point, this entire exercise starts showing why buying a car using crypto is not something that a sound investor would do.

The Hidden Cost Behind This Bad Idea:

⦁ Platform charges: To convert your Bitcoin to INR, any crypto exchange would first apply platform charge fees to facilitate the withdrawal. To be fair, this amount is nominal and charges between 0.1 percent to 0.2 percent on average. However, it is still an additional charge you pay to buy goods using crypto.

⦁ TDS: 1 percent Tax Deducted at Source (TDS) is also applicable on converting any crypto to Indian currency under Section 194S of the Income Tax Act, on transactions above Rs 50,000.

⦁ 30 percent Tax: Under Section 115BBH of Virtual Digital Assets (VDAs), including cryptocurrencies and NFTs. A 30 percent tax is imposed on converting crypto to INR.

An additional 4 percent Cess is also charged on such a transaction, essentially bringing the tax implication by up to 35 percent.

Overall Taxes Paid If Buying A Car With Crypto:

In case the point is still not clear to you. You are paying a lot more to purchase a car when trying to use Bitcoin or any other cryptocurrency.

Under the new GST rates, to buy a Thar Roxx, Fortuner or Defender, you would first pay the 40 percent unified GST as part of the ex-showroom value. Then you would pay 10 to 12.5 percent of that amount in road tax before paying an additional 18 percent GST on the vehicle's insurance. Above all these taxes, consider the 35 percent tax that you have already paid on crypto conversion just to have enough INR to pay for the vehicle.

Summary:

While buying a new car using your crypto gains may sound flashy, the reality is a lot more sobering. Based on what we have just learned, the on-road cost of a Mahindra Thar Roxx AX7L 4X4 Diesel Automatic in Delhi is Rs 28.05 lakh. However, for someone planning to use Bitcoin, the price jumps up to Rs 36.56 lakh on-road. Which is precisely why we do not advise anyone to follow this route for a car purchase.

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