Indian Crypto Industry urges clarity on crypto tax rules in Union Budget 2022-23
Indian tech industry association representing consumer internet start-ups
including crypto exchanges has written a letter to the country’s finance
minister Smt. Nirmala Sitharaman urging clarity on the various cryptocurrency
taxation imposed on crypto assets in Union Budget 2022-23.
In the letter, the association urged the government to amend existing tax rules to include crypto assets. Also, it asks to clarify the methods and ways of taxation and disclosures. As per the report Indiatech’s president and chief executive officer, Ramesh Kailasam, commented that “The budget should ideally offer coherent rules on direct taxation and the GST Council should detail the applicability of taxation, else there will be confusion.” Kailasam suggested that waiting for a bill alone shouldn’t be done, and the Budget should initiate the process. The letter said, “It is critical for the Union Budget to clearly lay down taxation clarity around crypto assets by formally naming them in tax laws,”. Members of the group participate in discussions on the policy framework for regulating crypto with government officials and India's central bank, the Reserve Bank of India.
It comes when in preparation for the upcoming Union Budget 2022, officials from the Ministry of Finance have been meeting with representatives from various industries. Furthermore, the much-anticipated Cryptocurrency Bill 2021 has now been pushed back to mid-2022, which was to be introduced in the just-ended winter session of parliament. It is likely that India's budget session will begin on Jan. 31, the budget will be presented on Feb. 1, and the session will last at least through April. On the same day it sent the letter, an in-depth report was published by CoinDesk about how Indian crypto exchanges were recently "inspected" by tax agencies, and that more than Rs 84 crore ($11 million) was "recovered." Binance was one of the exchanges inspected.
There are instances when some cryptocurrency exchanges are being accused of not paying goods and services tax (GST). India’s Directorate General of Goods and Services Tax Intelligence (DGGI) is scrutinizing several crypto firms that didn’t pay tax properly.
IndiaTech represents the major leading cryptocurrency exchanges in India. The association members of this industry body comprise CoinSwitch Kuber, WazirX, and CoinDCX.
CBW - External Analyst