India Cryptocurrency Tax Proposal: India has proposed a crypto tax in the form of GST or the Goods and Services Tax. A proposal was created to implement an 18% GST on cryptocurrencies.
India Cryptocurrency Tax Proposal
Annonymous sources told Bloomberg that the India cryptocurrency tax proposal would consider cryptocurrencies as goods and, thus, taxable. Those who are “facilitating transactions like supply, transfer, storage, accounting, among others, will be treated as services” and so will also receive the 18% crypto tax.
Miners, wallet providers, and exchanges will all be considered taxable under the 18% GST proposal.
The taxes may also be retrospective, to be applied as far back to any and all crypto transactions occurring from July 1st, 2017 and onwards. The proposal claims that based on how well crypto did from July 2017 to April 2018, the government could earn as much as Rs 360 crore ($3.6 billion US) in GST.
By treating cryptocurrencies as goods and services, rather than as a currency or security, taxation of crypto will be easier and won’t require any change in the law.
The tax would largely be an act by the government to disincentivize crypto trading and activity, something which the Indian government has long been trying to do. While the government hasn’t outright banned crypto, it has strongly suggested to its citizens to avoid cryptocurrencies due to their high risk and volatility.
At the beginning of April, the Indian government took things a step further and tried to ban crypto purchases from banking institutes. Indian crypto exchanges fought back with the support of the people.
The tax proposal is still just that – a proposal. Whether or not India uses this as its next swing against crypto remains to be seen.
Do you agree with the 18% GST proposal on crypto? Is this too high? Should crypto be taxed at all? Let us know what you think in the comments below.
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