Indian crypto businesses seek tax clarity from RBI

Tuesday 5 May 2020 04:41 CET | News

The cryptocurrency exchanges in India have written to the central bank of India for seeking clarity on the tax front.

On March 4, 2020, the Supreme Court nullified the RBI’s ban on banks dealing with crypto businesses. However, the cryptocurrency businesses in India are still unable to gain a foothold as unclear directions continue to limit their banking interactions with tax reforms.

Thus, the exchanges have formally drafted a letter to the RBI asking why they are still being denied banking services despite the overruling of the ban order and the reason for lack of willingness to offer guidance and instructions from the regulator.

The cryptocurrency exchanges in India demand clarity on the classification of their business. Their categorisation under commodities, goods, and services or currencies will ultimately decide how they will be taxed under the new GST system.

For instance, if the digital currencies are exempted from GST, it will eventually lead to a deadlock situation between the tax officials and the cryptocurrency exchanges in India, the online publication added. Furthermore, if RBI expects exchanges to pay GST on the entire transaction, then most of crypto businesses would not be able to survive.
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Keywords: commodities, goods, services, currencies, India, cryptocurrency, crypto exchanges, tax, RBI
Categories: DeFi & Crypto & Web3
Countries: India
This article is part of category

DeFi & Crypto & Web3