Indian Ministry of Finance proposes 18 percent tax on all bitcoin transactions related to payment for goods, services and trade.
According to the Central Bureau of Economic Intelligence, the annual turnover of the MTC in the country exceeds $ 5.4 billion, so the taxation of cryptocurrency can bring about $ 972 million to the treasury.The authors of the document propose to classify digital currency as a class of intangible assets subject to the current VAT.
The CBED has made a proposal despite the fact that cryptocurrency is not currently legal tender in India. However, this mechanism will be able to work successfully, since the country’s legislation provides for the taxation of income from illegal and criminal activities..
India’s Supreme Court overturned Central Bank’s ban in March to employ financial institutions with cryptocurrency, but due to regulatory uncertainty this market is evolving very slowly. Due to the lack of a dedicated regulatory body, the Ministry of Finance fears that digital assets will become actively involved in money laundering.
text: Ivan Malichenko, photo: Shutterstock