DGGI action on WazirX, others may set stage for crypto GST: Report


 






The Directorate General of GST Intelligence (DGGI) has recently cracked down on the half a dozen cryptocurrency exchanges operating in India for evading their goods and service tax liabilities. The authority already recovered Rs 49.2 crore from major exchange WazirX, but authorities estimate that a total of Rs 70 crore of evasion has been detected.
GST on cryptocurrency has been a subject matter of dispute from the taxability and valuation perspective. Transaction fees are always paid by senders; these will be part of consideration as they are made in cryptocurrency in response to the supply of services by the recipient of services, and cryptocurrencies are rewarded by the blockchain system to the crypto miners on successful verification of transactions," said Abhishek A. Rastogi, Partner at Khaitan & Co.

Now the tax departments stand to slap an 18 percent GST on cryptocurrency exchanges for their services and their margins bring them more in line with commodity exchanges and other similar services. The move from the tax department has been welcomed by many in the cryptocurrency industry as it brings much-needed clarity to the hazy segment.
The crackdown by tax authorities on cryptocurrency exchanges started from an investigation into the business practices of WazirX. The company allowed customers to make trades using its own cryptocurrency WRX or the rupee. While the company collected a commission on both, rates for both methods differed.
However, the company was only paying GST on the commissions it was collecting on transactions made through the rupee and not the ones paid through WRX. Since this commission was being charged to both the buyer and seller in the form of trading fees, deposit fees and withdrawal fees, the sum quickly ballooned to a huge figure.



Download our App to get knowledge updates: https://play.google.com/store/apps/details?id=com.app.gstmitra




Join Our Telegram Channel for more updates:https://t.me/praveengst


























Comments

Post a Comment

Popular posts from this blog

Centre appeals against ruling on levy of GST on maintenance charges to resident welfare associations

Image
  The Centre has preferred a writ appeal before the Madras High Court against a single judge's order that flat or villa owners paying more than ₹7,500 a month towards maintenance charges to their residents’ welfare associations must pay Goods and Services Tax (GST) at the rate of 18% only for the amount exceeding ₹7,500 and not for the entire monthly contribution. Justices T.S. Sivagnanam and Sathi Kumar Sukumara Kurup on Wednesday allowed an application filed by the Centre to dispense with production of a certified copy of the judgment passed by Justice Anita Sumanth recently and directed the Registry to list the appeal for admission in the usual course. Justice Sumanth had in July this year quashed an order passed by the Authority for Advance Ruling (AAR) on June 21, 2019 as well as a consequent circular issued by the Department of Revenue under the Union Finance Ministry on July 22, 2019 since both of them had insisted upon collecting GST for entire monthly contribution. The jud...
Read more

Seven key things to know before filing income tax return (ITR) for FY21

Image
  The last date to file income tax return for the financial year 2020-21 has been extended to September 30, 2021. Although there is more than two months left for the deadline to end, it is always recommended to complete the task as soon as possible and not to wait for the last minute. Worth mentioning here is that the income tax department last month launched a new e-filing portal (www.incometax.gov.in) to speed up the processing of tax returns. The I-T department will soon launch a mobile application, having all the features of the new portal. This year taxpayers have to take care of the following changes in the ITR filing process. 1) A new utility named JSON has been launched for filing tax return forms for FY21. At present, only three forms, ITR 1, 2 and 4 have been released. These new forms will import pre-fill data such as personal details, salary income, dividend income, interest income, capital gains and all the information available in Form 26AS. 2) Taxpayers will have the ...
Read more

Income Tax Dept detects ₹350 cr unaccounted cash receipts after raid in Rajkot

Image
  The Income Tax Department carried out a search and seizure operation on a real estate group based in Gujarat's Rajkot and found unaccounted cash receipts in various projects of approximately ₹350 crore, the Finance Ministry said on Friday. The group is among Gujarat’s prominent real estate builders and developers and is actively engaged in real estate, construction and land trading businesses in and around Rajkot. More than 40 premises were covered in the search operation. During the course of operation, many incriminating documents and digital evidences were seized indicating involvement of the group in unaccounted transactions. The IT sleuths found substantial evidence of transactions outside the regular books of accounts, unaccounted cash expenses, cash advances received and interest paid in cash. Evidence of on-money payments in real estate projects-flats, shops and land deals has also been found. Total unaccounted cash receipts in various projects of approximately ₹350 crore...
Read more