India’s tax authority has reportedly asked major cryptocurrency exchanges in the country to provide information pertaining to the coins traded on their platforms. The tax authority is also evaluating the taxability of crypto transactions to determine if the goods and services tax (GST) can be applied to them.
Indian Crypto Exchanges to Provide Details of Coins Traded on Their Platforms to Tax Authority
India’s Central Board of Indirect Taxes and Customs (CBIC) has asked major Indian crypto exchanges to provide details about the cryptocurrencies traded on their platforms, Business Standard reported Friday. A senior official was quoted as saying:
We had meetings with crypto exchanges on wide-ranging issues relating to the asset class. We have sought a detailed report on different crypto products being traded and their respective transaction fees and how they are getting calculated.
In addition, the CBIC is reportedly evaluating the taxability of crypto transactions to determine if the goods and services tax (GST) can be applied to them. The tax authority is also working on the definition and classification of crypto assets.
The official explained that with a better understanding of these crypto products and how they are transacted, it would be easy to determine how GST could apply to them and their applicable tax rate. The tax authority gave crypto exchanges until the end of this month to provide the information.
Currently, an 18% GST is levied on services provided by crypto exchanges. The Indian government began taxing cryptocurrency income at 30% in April and a 1% tax deducted at source (TDS) for crypto transactions went into effect in July. Last month, the Ministry of Finance revealed that it is working on how GST could be applied to crypto.
The Indian government is currently working on the country’s crypto policy. Finance Minister Nirmala Sitharaman said earlier this month that the government plans to discuss crypto regulation during its G20 Presidency in order to establish a technology-driven regulatory framework. A government official reportedly said last month that India plans to finalize its stance on the legality of crypto by the first quarter of next year in order to be compliant with the standards set by the Financial Action Task Force (FATF).
What do you think about how India is planning to tax cryptocurrency transactions? Let us know in the comments section below.
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