India has not yet lifted its ban on cryptocurrency and its trading practices. The regulators have filed a petition in Supreme Court against the ban imposed by Reserve Bank of India. Although, the fight isn’t going to stop there as government officials are about to bring in a new set of tax rules for crypto trade. The cryptocurrency exchange has a long way to go for a smoother trade practice.
Indian taxpayers are already burdened with the latest addition of goods and service tax (GST) last year. The overall understanding and its execution have been a high tide for taxpayers in India. There was a lot of noise before its implementation. In an alleged update, it is revealed that cryptocurrency trade will be joined in this category of tax. The rules and its implications are yet to be defined.
Crypto Trading In India
As suggested by Bloomberg, the Indian government is likely to place the digital currency trade under GST which will cost 18% to the traders. The trading is subject to purchase and supply of goods in the form of digital asset. The actual value of a digital asset will be based on its value in INR or the equivalent currency of trade. All the investors dealing with other countries will be liable for tax under GST rule.
The tax department has tracked down around 100,000 investors and traders earlier this year in February. It was found that there was a cryptocurrency transaction of about $3.5 billion done in the last 17 months.
Central Board of Indirect Taxes and Custom is said to be considering the proposal right now. However, the matter will move ahead only after the impending hearing of the case of cryptocurrency ban next month. The dealers were issued a notice on the basis of tax avoidance. Even though there is no real and specific law defining the rules for crypto trade, there is a scene of uncertainty about the entire matter.
[The views and opinions expressed in this article are those of the authors and do not necessarily reflect the views and/or the official policy of the website. ]