GST Council to consider 28% GST on Cryptocurrencies in India
Goods and Service Tax (GST) Council is considering 28 % GST on cryptocurrencies and related services.
The Indian government's thought is to bring cryptocurrencies at par with lotteries, casinos, racecourses, and betting.
The GST council has assigned a law committee to take up the proposal to impose 28 % GST on services and all activities related to cryptocurrencies soon.
The proposal is likely to be tabled in the next GST Council meeting, but no decision has been taken on the date yet.
"There are different aspects of cryptocurrencies the transactions involving cryptos, cryptos being used to make purchases, cryptos being received as payments. All these aspects are under examination and will be discussed by the law committee said"
The sources said that all crypto exchanges in India act as intermediaries. "They sell cryptos from foreign exchanges to percent GST stab and organized as intermediary service. They will have to be classified separately under a new head."
"So, every transaction will be subject to 28 percent GST, if decided upon by the GST Council,"
Online gaming attracts 18 percent GST right now the ones involving betting along with gambling race clubs attract 28 percent.
The finance ministers were unanimous on hiking the GST rate on the casino, racecourse, and online gaming services to 28 %. West Bengal finance minister Chandrima Bhattacharya had said. However, a call on whether the tax should be levied on gross or net valuation was to be taken after further deliberations.
Crypto investors also pay 30% income tax plus cess and surcharges on earnings from virtual digital asset transactions after such a proposal was declared in the 2022-23 Budget
Also Budget offered a 1 % TDS on payments towards virtual currencies above 10,000 INR in one year and taxation of such gifts in the hands of the recipient. The threshold limit for TDS would be 50,000 INR a year for specified persons. which includes individuals who are required to get their accounts audited under the l-T Act. The TDS will come into effect from July 1.