• Notification Date: 28-12-2024
• Notification No: N/A

Govt. Uncovers 824 Cr GST Evasion by Crypto Firms; Only ?122 Cr Recovered So Far

The Indian government has detected a massive Goods and Services Tax (GST) evasion worth 824.14 crore by top crypto exchanges such as Binance, WazirX, CoinDCX, and CoinSwitch Kuber in one of its notable crackdowns on the cryptocurrency sector. Despite the large sum, only 122.29 crore, including interest and penalties, has been recovered, according to a written reply in Parliament by Finance Minister Pankaj Chaudhary on Monday.

The Binance group comes to the top with a whopping GST evasion amounting to ?722.43 crore, though no recovery has been made yet. WazirX, the operated company by M/s Zanmai Labs Pvt. Ltd, followed with ?40.51 crore GST evasion, though authorities had recovered ?49.18 crore from the platform along with other penalties and interest.

CoinDCX and CoinSwitch Kuber were also caught in the GST net, evading amounts of ?16.84 crore and ?14.13 crore, respectively. The government can recover ?20.86 crore from CoinDCX and ?19.38 crore from CoinSwitch Kuber.

This has come at a time when scrutiny of crypto operations in India is rising. Since March 2023, the government has imposed stronger regulations by bringing crypto assets within the scope of the Prevention of Money Laundering Act (PMLA). In addition, there is a flat rate tax on crypto transactions of 30%, with an additional 1% being deducted at source on all transactions above ?50,000 annually.

The Financial Intelligence Unit-India has also furthered enforcement by virtue of 47 Virtual Digital Asset Service Providers (VDA SPs) that have now been registered as reporting entities. Risks, however, are only mounting for cryptocurrencies. Even RBI Governor Shaktikanta Das and Financial Services Secretary M. Nagaraju have questioned the sector, cautioning against the potential risks to financial stability.