Indian Government Weighs Imposing 18% GST Tax On Every Bitcoin Trade
This could potentially bring in just under $1 million to the government in taxes.
The Indian government may not be ready to regulate cryptocurrencies yet but it doesn’t want to let go of the opportunity to fill up its coffers by levying heavy taxes on them. Bitcoin transactions are estimated to be around Rs 40,000 crore ($5.45 million USD) annually in the country.
The government is weighing a proposal to impose 18% goods and services tax (GST) on bitcoin transactions that could potentially provide them with Rs 7,200 crore (nearly $981k) annually on BTC trading in the country.
The Central Economic Intelligence Bureau (CEIB), an arm of the finance ministry is the one that has put forward the proposal in front of the Central Board of Indirect Taxes & Customs (CBIC). CEIP has conducted a study on levying GST on crypto assets.
According to local sources, CEIB has suggested that Bitcoin can be categorized under the “intangible assets” class and a GST can be imposed on all transactions.
Earlier this month, the Enforcement Directorate (ED) arrested a crypto trader in connection with a money-laundering probe linked to an online betting racket worth about Rs 1,000 crore ($136.2 million) with Chinese operators.
Back in 2018, the Reserve Bank of India (RBI) virtually banned crypto trading which was quashed by the Supreme Court which then asked the government to come with crypto regulation policies last year.