The Indian government has taken action against 11 cryptocurrency exchanges in the nation, including CoinDCX and CoinSwitch Kuber, for tax evasions totaling Rs 81.54 crore, Minister of State for Finance Pankaj Chaudhary said on Monday.
Chaudhary said in a written response to a Lok Sabha question that the total amount recovered from cryptocurrency exchanges, including interest and penalty costs, is Rs 95.86 crore.
In addition, the Indian government stated that it does not gather any information on cryptocurrency exchanges.
The Indian government is “trying to gain a foothold in understanding the many issues it will encounter in execution once rules are in place,” according to Pratik Gauri, creator of 5ireChain, a blockchain ecosystem.
The Indian government and crypto tax
According to Chaudhary, central GST organizations have only uncovered a few examples of crypto exchanges evading GST.
He went on to say that 11 cryptocurrency exchanges were examined for tax evasion, with Rs 95.86 crore seized in total, including interest and penalties.
The case of CoinDCX involved a Rs 15.7-crore tax evasion inquiry. According to the Lok Sabha reply, Rs 17.1 crore has been collected, including interest and penalties.
Buy Uncoin was charged with Rs 1.05 crore in tax evasion, of which Rs 1.1 crore was recovered. The CoinSwitch Kuber case featured tax evasion worth Rs 13.76 crore, with a total recovery of Rs 16.07 crore.
Awlencan Innovations India (Zebpay) was implicated in a Rs 2.01 crore tax evasion, with Rs 2.5 crore confiscated. UnoCoin is being investigated for Rs 2.97 crore in tax evasion, of which Rs 4.44 crore has been recovered.
Following huge GST evasion by cryptocurrency exchange WazirX earlier this year, the Directorate General of GST Intelligence came down hard on cryptocurrency exchanges in the nation.
Crypto’s confused stance in India?
Finance Minister Nirmala Sitharaman said on February 1 in the Budget 2022 that profits from any virtual digital asset will be taxed at 30%, with no loss set off. She stated that no expenditures or allowances will be recognized while calculating such revenue, except the cost of purchase.
The Indian government also clarified last week that losses resulting from the transfer of virtual digital assets cannot be offset by profits from another. Mining expenditures, it added, cannot be considered acquisition costs.
Due to the lack of regulatory law, the legal status of cryptocurrencies is still unclear. Investors argued the clauses in the Indian government’s tax proposal on cryptocurrency essentially legalized crypto trading.