Financial Insights

Taxes worth over Rs 80 crores evaded by 11 crypto exchanges

The government has initiated actions against several major Cryptocurrency exchanges like WazirX, CoinDCX, CoinSwitch Kuber, etc. for evading GST amounting to around Rs 81.54 crores.

Minister of State for Finance Pankaj Chaudhary on Monday said that following the detection of tax evasion, the recovery process initiated by the cryptocurrency exchanges, including interest and penalty charges, has yielded Rs 95.86 crore.

In the Budget 2022, Finance Minister Nirmala Sitharaman announced that profit from any virtual digital asset will be taxed at 30 per cent, without any loss setoff. She had added that no deduction of any expenditure or allowance would be allowed while computing such income, except the cost of acquisition.

However, two months after the budget tax proposals on crypto earnings, the legal position of cryptocurrencies remains obscure and there is no law regulating the ecosystem. However, the government’s tax proposals have set off a perception among the exchanges and investors that the provisions have effectively legalised crypto trading. This is, despite Nirmala Sitharaman’s clarification that taxing cryptocurrencies does not mean they have been legalised.

Highlight by Aman Agarwal.

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