India’s IT cracks down on bitcoin exchanges for alleged tax evasion

By
0
774

The Income Tax (IT) Department of the Indian government has reportedly swooped in on nine bitcoin exchanges to look into alleged tax evasion

According to a report from the Press Trust of India (PTI), the country’s largest news agency, multiple investigative teams from the IT department in India jointly visited the premises of nine bitcoin exchanges to conduct ‘survey operations’ on suspicion of alleged tax evasion.

Under section 133A of the Income Tax Act, the survey enables the tax sleuths to gather “evidence for establishing the identity of investors and traders, transaction undertaken by them, identity of counterparties, related bank accounts used, among others,” the report cites official tax authority sources as stating.

The coordinated operation saw multiple teams visit nine unnamed exchanges in a number of cities including Delhi, Bangalore, Hyderabad and Kochi, according to the report. The swoop is seen as the first major operation by Indian tax authorities against bitcoin exchanges, coming at a time when bitcoin prices continue to break record highs—up over 1,700% since the turn of the year.

Earlier this year, major Indian bitcoin exchanges launched a self-regulatory body to standardize AML and KYC norms for users and adopters as authorities and regulators continue to remain ambiguous over clear guidelines or a regulatory future for the industry. In November, India’s Supreme Court called on authorities and various ministries to draft legislation to “regulate the flow of Bitcoin” in India’s nascent but surging bitcoin ecosystem.

Earlier this month, Reserve Bank of India issued its second warning to the public cautioning them about digital currencies, in particular, bitcoin. In a notice on 5 December, the RBI warned adopters about the ‘potential economic, financial, operational, legal, customer protection and security related risks’ regarding the use of virtual currencies such as bitcoin.

As a result, a number of investors have started to sell their coins. Experts claim that returns from the cryptocurrency could attract as much as 20-30 percent tax, and that if anyone is selling bitcoins and the money comes to the bank account, this would attract either long-term capital gain tax or short-term capital gain tax, depending on the holding period.

 

Spread the love and Earn Tokens

NEWSLETTER


  THE INDIAN SUN NEWSLETTERS

Get the latest news and updates emailed straight to your inbox.



By submitting your email you are agreeing to The Indian Sun’s terms and conditions and privacy policy.




Comments