The center seems to be examining the applicability of goods and services tax (GST) on various cryptocurrency transactions including the mining of the digital assets.
GST On Cryptocurrency Transactions
At present, the issue is being examined internally at the Central Board of Indirect Taxes and Customs (CBIC).
According to CBIC chairman, Vivek Johri, a proposal will be taken to the GST Council.
Further adding that “There are several aspects of the operation which intersect with GST as a tax,”.
A flat 30% capital gains tax on virtual digital currencies beginning April 1, 2022 will be applicable as per the proposed budget.
It seems that the levy of GST on other transactions in them could raise the overall incidence of tax on cryptocurrencies.
Johri said that the services provided by a platform, or an exchange operator, were duly recognised as taxable services.
So authorities have been charging them with tax.
Further adding, Johri said, the issue of supply of cryptocurrencies required more detailed examination. “You mine crypto…the first question is does that involve a supply or not. Second is, I acquired crypto and I’m selling it to somebody else or I’m using it for barter. How do we deal with that,”.
He said, pointing to some of the issues the department is looking into.
“Is that a supply of money, or is that a supply of goods and services, or is it just an actionable claim? These are the other aspects which involve the GST issue that we are examining at the moment,” he said.
At -present, the issue is being examined within the CBIC and it could take 2-3 months, Johri said.
Tax Concession On Electric Vehicle
While talking on the issues of a tax concession to electric vehicle maker Tesla, Johri said it was felt that no change was required in the structure, while declining to comment on the specific case of the company.
He said, “When the government examined the rate structure, it was found that there were other multinational carmakers that were importing CBUs (completely built units) at 100% customs tariff to sell here. We looked at the structure, but (after examination) we felt that no rejig was required at this stage,”.
Comments are closed, but trackbacks and pingbacks are open.