Tax authorities to inspect scope of GST levy on crypto

Source: Economic Times dated 11.02.2022

The finance ministry will soon meet with representatives of the cryptocurrency industry to discuss the fine print of indirect taxation on virtual digital assets, Business Today TV reported.

The Central Board of Indirect Taxes and Customs (CBIC) is looking into the aspect of indirect taxes on virtual digital assets. “It is too early to comment if the proposal will be taken up at the next GST council. We are still examining the matter internally. We will also interact with cryptocurrency exchanges to get clarity”, the official was quoted as saying.

The Finance Ministry has already received several requests from cryptocurrency industry participants for clarity on the taxation regime.

The government, during the Budget, proposed a direct tax on transfer of any virtual/ digital asset. These assets will be taxed @ 30%, and there will be no deduction, except cost of acquisition.