11 Crypto Exchanges Fined for Tax Evasion in FY22: Indian Minister 

On March 28, the Indian Parliament figured out that crypto exchanges had evaded Goods and Services Tax (GST). Pankaj Chaudhary, Minister of State for Finance, informed that 11 digital asset platforms were penalized for tax evasion between 2021-22.

Crypto Exchanges to Avoid Tax Evasion

These companies committed total tax evasion of Rs. 81.54 Crore (approx. $1.08 million) and a fine, the Central Goods and Services Tax Authority (CGST), recovered Rs. 95.86 crore (or $1 million) was taken from them by the minister, who informed Lok Sabha of this information, which is the lower house in the Indian Parliament.

This information was provided by the junior finance minister in response to a question. He also explained that the Indian government does not collect data on cryptocurrency exchanges. The CGST, a division of the Central Board of Indirect Taxes(CBIT), detected the tax evasion.

These cases of tax evasion through crypto exchanges were discovered in January 2018. With Rs 40.51 core, Binance’s WazirX (Zanmai Labs), the largest defaulter (approximately 0.53 million)

Other digital asset exchanges that were included in the GST evaders list were Flitpay and Flitpay.

Tax defaults can be caused by classification uncertainty

Most trading venues paid taxes and fines promptly, with the common refrain that default was due to ambiguity of GST rules applicable to such exchanges.

These investigations led to the question of how crypto exchanges should be classified among the four GST tax slabs. These companies are now classified as financial service providers and therefore the GST tax slab 18% applies.

The Indian government has imposed a 30% tax on the profits of digital assets and a 1% TDS for all crypto transactions through the budget 2020-223. However, the GST authorities plan to place crypto exchanges in the same group as gambling, horse-racing, betting, and other activities that attract the 28% GST slab.

Although crypto transactions and profits were taxed by the authorities, it is not clear if cryptocurrencies or exchanges are legal in India. All Indian crypto exchanges have been registered abroad and maintain offices in the country.

The Indian central bank has repeatedly opposed legalization of cryptocurrency, comparing them to Ponzi schemes.

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Marla Brooks

Marla Brooks – Financial Analysis My name is Marla Brooks, and I am the mainstream behind the”observednews.com”  for the powerful and most delicate insights into the latest activities in the financial analysis category. I started my journey as an independent financial consultant. I had approximately nine years of experience in this field. I am free soul so; my passion for exploring the world has taken me to the nations across the globe and given me the chance to report for a portion of the best news associations. Currently, I am a full-time editor as experienced in finance and started to use my abilities.

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