• Notification Date: 07-12-2022
  • Notification No: N/A

Council Aims to Highlight Imposition of GST on Cryptocurrency on Next Meeting

As per a report by CNBC Awaaz, the implementation of Goods and Services Tax (GST) on cryptocurrency might be delayed further. At present, the panel of officers have not submitted their report to the government regarding the matter. However, people are aware that the decision is likely to be brought up in the next meeting of the GST Council which is scheduled for December 17. 

It has been a question for a long time that when the digital asset will be brought under the taxation umbrella at the rate of 28 percent of tax levied starting as early as May this year. Now, people are hoping the decision to be finalized on the last GST Council meeting of the year for this decision. 

There is no GST but there are TDS provisions on virtual digital assets (VDA) or cryptocurrencies at present. This rule has been effective since July 1. There is a provision of 1 percent TDS on virtual payment of more than Rs 10,000 in a year. Union Finance Minister Nirmala Sitharaman announced the imposition of a 30 percent tax on income from cryptocurrency in the Union Budget 2022-2023. According to the reports, it is likely that in the GST council meeting it will be decided whether cryptocurrency will be included in the category of 'Goods' or 'Services' or not. 

GST is likely to be levied only on the margin or service fee received from crypto currency. In other words, GST will not be implemented on the total value of cryptocurrency. CNBC Awaaz has also learnt that the Group of Ministers (GoM) on Online Gaming and Casinos has not submitted its report. 

According to the information received, GST rates on online gaming, casinos and horse racing are difficult to be agreed upon in the Group of Ministers. The last month’s report says the GoM panel is likely to stick with its earlier recommendation of a 28 per cent levy on these segments. The final valuation mechanism will be logged on to the court of the GST Council. 

In its earlier report in June, the GoM, led by Meghalaya Chief Minister Conrad Sangma, proposed a 28 percent GST on the entire consideration, including contest entry fees, paid by the player, without distinguishing between skill games and chance games. The Council had asked the GoM to reconsider its report. 

The GST Council Group of Ministers will also consider a reduction in rates on insurance premiums. It can be reduced from the existing 18 percent to 12 percent. This will also be the main agenda in the next meeting of the GST Council.