India’s Minister of State for Finance, Pankaj Chaudhary, has revealed that the government has recovered $2.3 million from 11 cryptocurrency exchanges for tax evasion including interest and penalty charges.
The exchanges are Buy Ucoin, CoinSwitch Kuber, Unocoin, Flitpay, Zeb IT Services, Secure Bitcoin Traders, Giottus Technologies, Awlencan Innovations India (Zebpay), Zanmai Labs (WazirX) and Discidium Internet Labs.
Speaking with Lok Sabha, the Parliament of India, Chaudhary said that the authorities took action against crypto exchanges that evaded the goods and services tax (GST). The minister also stated that the government did not collect any data from the crypto companies.
This is happening barely a month after the Indian government legalized the use of cryptocurrency in the country, while passing a bill geared toward cryptocurrency taxation.
India Impose 30% Tax on Crypto Assets
In February 2022, India’s finance minister Nirmala Sitaraman revealed that the government has imposed a 30% tax on all cryptocurrency revenue including the country’s central bank digital currency.
“There has been a phenomenal increase in transactions of virtual digital assets. The magnitude and frequency of these transactions have made it imperative to provide for a specific tax regime… I propose that any income from transfer of any virtual digital asset shall be taxed at a rate of 30%,” says Sitaraman.
Just recently, JB Mohapatra, the chairman of the Central Board of Direct Taxes (CBDT), announced that the proposed bill will be effective from April 1 and crypto traders will be charged 30% for tax on crypto revenues.
Not the First
Meanwhile, India is not the first country to tax crypto income. Back in 2018, the Japanese National Tax Agency (NTA) introduced regulatory measures to combat cryptocurrency tax evasion in the country.
According to the report, all crypto-related transactions and their gains are labeled as “miscellaneous income” under Japan’s income tax. This means that every crypto investor in the country who earns up to 200,000 yen ($1,773) should report such earnings as income.
Crypto exchanges were also obligated to comply with the measures to enable the NTA to fetch out defaulters by supplying relevant information such as customer names, identification numbers and home addresses.
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