Top Cryptocurrency Providers In India Raided By Tax Officials: Report

[IIrik11]

https://www.ndtv.com/india-news/dggi-cracks-down-on-cryptocurrency-exchanges-across-country-rs-70-cr-tax-evasion-detected-2682998

New Delhi: After the massive tax evasion of GST by Cryptocurrency Service providers WazirX, the Directorate General of GST Intelligence has come down heavily on Cryptocurrency exchanges operating in the country, said sources.
"Around half dozen offices of Cryptocurrency Service providers have been searched and massive Goods and Service Tax (GST) evasion has been detected by DGGI," sources told ANI.

Crypto wallet and exchange are platforms where merchants and consumers can transact with digital assets like bitcoin, ethereum, ripple, etc.

According to sources, around ₹ 70 crore worth of tax evasion has been detected during the crackdown on Cryptocurrency trade by Mumbai CGST and DGGI.

"The DGGI is investigating Coinswitch Kuber by M/s Bitcipher Labs LLP, CoinDCX by M/s Neblio Technologies PVT. LTD., BuyUCoin by M/S I Block Technologies Pvt. LTD. and Unocoin by M/s Unocoin Technologies Pvt. LTD," sources said.

Official sources further said, "They are providing facilitation intermediary services for buying and selling of crypto coins. These services attract GST rate of duty of 18 per cent which all of them have been evading."

Another official source, who was part of this search, told ANI, "These service providers were charging a commission for their facilitation to indulge in exchange of bitcoins but were not paying GST tax. These transactions were intercepted by DGGI and they were confronted with evidence that proved non-payment of GST."

A top source told ANI that they paid ₹ 30 crore and ₹ 40 crore as GST, interest and penalty for non-compliance to the statutory provisions of GST law. For violating GST laws the CBIC has recovered ₹ 70 crore from Cryptocurrency Service providers including WazirX.

On Friday, GST Mumbai East Commissionerate of Mumbai Zone detected GST evasion of ₹ 40.5 crore from cryptocurrency exchange WazirX and recovered ₹ 49.20 Crores in cash pertaining to GST evaded, interest and penalty.

As per the claim made CoinDCX their crypto app allows buying of bitcoin and other cryptocurrencies instantly in India and has more than 7.5 million users and more than one crore downloads with ₹ 7 billion cryptos purchased.

As per the website which CoinSwitch Kuber trading platform has processed over USD 5 billion, BuyUcoin based out of Delhi-NCR in India has more than one million users and traded more than USD 800 million.

Unocoin is also a platform to trade Bitcoin, Ether, Tether, among other such platforms of crypto assets has offices in Bangalore which have processed more than 10 million as per their website.

apart from collecting all the money from these exchanges.

they will also gather all the information of the traders.

and then they will hunt them next for tax evasion and what not.

so, the people who have traded on centralized exchanges with their kyc and hasn't paid their tax.

better get on it right away!

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[avikz]

apart from collecting all the money from these exchanges.

they will also gather all the information of the traders.

and then they will hunt them next for tax evasion and what not.

so, the people who have traded on centralized exchanges with their kyc and hasn't paid their tax.

better get on it right away!

That is the biggest risk of using centralized exchanges in a country where cryptocurrencies are not defined by law yet. But whoever has invested through these exchanges, they are not in huge risk. if you have made few thousands in profit, that should be all fine. Income Tax department doesn't have time to go behind 7 million people. But if someone has done millions in profit and the data is not shown in their tax return, they are in danger! And that's how it should be! No one should mess with the government.

Also I don't understand why GST department had initiated this raid! Where cryptocurrency is not defined under any law, how can a transaction in crypto can attract GST! That's very unfortunate to be honest!

[teosanru]

First, the government is not able to bring in any law relating to cryptocurrencies, then they are not having any proper tax law governing cryptocurrency, and even after that they try to hunt down exchanges who are doing evasions, the problem is even if the exchanges would be paying GST. Department would still argue taking their own explanation of the law and blaming the exchanges of the wrongdoing. But yes, there is one good thing in all this, if governments start to get their share of the revenue from the crypto trading world they will surely not think of making it illegal.

[pakhitheboss]

There is nothing wrong with what the CBI did today if you are earning from the cryptocurrency business then you need to pay taxes on those earnings. There is still time to pay those taxes but it has to be done before the march of 2022. In case if anyone has still not filed the ITR then please do so. This was suppose to happen and I assume that the bill will now get passed in the next session of parliament.

[uttoransen]

Also I don't understand why GST department had initiated this raid! Where cryptocurrency is not defined under any law, how can a transaction in crypto can attract GST! That's very unfortunate to be honest!

It will all come under GST when the coins gets converted to real money. As long as the coins are BTC, ETH or whatever, they are fine and pretty much out of tax issues. The exchanges are taking money and converting it to the coins - which is easily taxable.

[pawanjain]

There is nothing wrong with what the CBI did today if you are earning from the cryptocurrency business then you need to pay taxes on those earnings. There is still time to pay those taxes but it has to be done before the march of 2022. In case if anyone has still not filed the ITR then please do so. This was suppose to happen and I assume that the bill will now get passed in the next session of parliament.

I read in an article that WazirX did pay the taxes so that they don't fall under the category of tax evasion but they still did.
A spokesperson from their team said that they paid more tax instead so that they don't get penalized and it was not their intention towards tax evasion.
He also said that it was all because misinterpretation of GST rules which sounds true since there is no clear regulations and law towards crytpocurreny yet.

source : https://cointelegraph.com/news/indian-taxman-recovers-6-62m-from-wazirx-for-evading-tax-on-commission