India GST Council Plans to Levy 28 Percent GST on Crypto Transactions: Report

The government’s aim is to bring cryptocurrency taxation on par with taxes on lotteries, casinos, and other forms of betting.

India GST Council Plans to Levy 28 Percent GST on Crypto Transactions: Report

Photo Credit: Pexels/ Karolina Grabowska

The proposal to hike tax on crypto is likely to be tabled in the next GST Council meeting

Highlights
  • The crypto industry has already been buckling under income tax, TDS
  • The GST Council governs the rules on the goods and services tax
  • Transactions on Indian exchanges are subject to an 18 percent GST now

In what appears to be another mood spoiler for crypto investors in the country, Indian tax authorities are planning to put crypto activities in the category of services that attract the highest Goods and Services Tax (GST) of 28 percent. According to reports, the GST council has constituted a committee to study and map different crypto activities such as trading, staking, and wallets for tax purposes with a proposal expected to be tabled in the next GST Council meeting, a formal date for which is yet to be made official.

As of now, crypto exchanges are levied 18 percent GST and are considered intermediaries offering financial services. But as per a CNBC-TV18 report, the GST Council could be planning to club crypto activities with speculative activities such as gambling, lottery, betting, and horse racing.

Sources close to the outlet state that the GST Council, which governs the rules on the goods and services tax, has nominated a law committee to suggest changes to the fitment committee, which will decide on the GST rate for crypto. The proposal of the fitment committee will be sent to the GST Council for final approval.

The move comes after state finance ministers reached a unanimous decision last month to increase the tax rate for horse racing, casinos, and online gaming. To discourage gambling and betting related online games, the GST Council is likely to hike the tax rates for online gaming too from 18 percent to 28 percent, reports suggest.

If the GST is raised from the existing 18 percent to 28 percent, it will be another major blow to the Indian crypto sector. Through the annual budget, the Indian government has already introduced a new taxation policy for the crypto industry that levies a 30 percent capital gains tax and 1 percent TDS on the transfer of digital assets. This move has greatly eroded trade volumes across major Indian crypto exchanges.

On top of the 30 percent income tax on crypto profits, 1 percent TDS, and 28 percent GST in the offing, crypto investors also have to factor in exchange fees, and additional cess and surcharges. All put together, crypto investments are heading in a direction of becoming prohibitively expensive in the country.


Xiaomi 12 Pro is littered with features, but is that enough? We discuss this on Orbital, the Gadgets 360 podcast. Orbital is available on Spotify, Gaana, JioSaavn, Google Podcasts, Apple Podcasts, Amazon Music and wherever you get your podcasts.

Cryptocurrency is an unregulated digital currency, not a legal tender and subject to market risks. The information provided in the article is not intended to be and does not constitute financial advice, trading advice or any other advice or recommendation of any sort offered or endorsed by NDTV. NDTV shall not be responsible for any loss arising from any investment based on any perceived recommendation, forecast or any other information contained in the article.

Comments

For the latest tech news and reviews, follow Gadgets 360 on Twitter, Facebook, and Google News. For the latest videos on gadgets and tech, subscribe to our YouTube channel.

Shomik Sen Bhattacharjee
Shomik is a senior sub-editor at Gadgets 360. As someone who's screened the consumer tech space for the past four years, he's now shifted focus to the crypto-verse. When not converting currency values in his head, you may find him in an intense five-a-side football match or grinding out the newest Destiny 2 weekly challenge on his Xbox. You can reach him for tips or queries at ShomikB@ndtv.com. More
Electric Vehicle Battery Explodes While Charging in Telangana, No One Injured
Samsung Galaxy S23 Ultra May Feature 200-Megapixel ISOCELL HP3 Camera Sensor: Report
Read in: हिंदी
Share on Facebook Tweet Snapchat Share Reddit Comment

Advertisement

Advertisement

© Copyright Red Pixels Ventures Limited 2022. All rights reserved.