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Cryptocurrency Exchanges in India Demands Clarification on Taxation from Central Bank
Sep, 29 2020
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Indian Cryptocurrency exchanges have asked
India’s Central Bank – Reserve Bank of India (RBI) for clarification on the
domestic crypto- tax regulations. After the historical decision of the Supreme
Court of India lifting the ban on the crypto industry and legalizing the crypto
transactions, an ambiguity is still lingering about the crypto taxation.
As per the recent development, the crypto exchanges have written a letter to the RBI seeking clarity on their status. The
letter states that the money lenders are denying the banking services to the
crypto industry due to a lack of clear guidelines for taxation from the
RBI.
The exchanges are asking for the
categorization of crypto assets for the convenience of tax payments. The
clarification on whether the crypto assets will be classified under commodity,
goods, currency, or services will make a significant difference as they will be
treated accordingly under the newly introduced tax structure - Goods and
Service Tax (GST).
PraveenKumar VijayKumar, Chairman and CEO
of crypto exchange Belfrics Global commented:
“If the digital assets are not exempted
from GST, the digital currency exchanges of India are going to have a standoff
with the Tax authority.”
He further added, “In the wake of the
recent Supreme Court ruling, we have also approached the RBI for clarity on
this as if we pay GST on the whole transaction, then most platforms would not
be able to survive.”
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Jayashree Ingle
CBW - External Analyst
INDIA
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