Highly watched and often controversial India has still not brought a definitive regulatory framework for cryptocurrencies, but according to the latest information, the department of indirect taxes is planning an unpleasant surprise for overseas crypto exchanges.
This unpleasant surprise is to be sought by the aforementioned department of indirect taxes, which should have already begun to examine whether foreign crypto exchanges will be obliged to pay Goods and Services Tax.
As this is a rather controversial topic, several experts also commented that the Indian Tax Department would categorize such services as an online information database access and retrieval (OIDAR) service. The current OIDAR rules stipulate that all digital or data services provided to the people of India should be taxed.
If such a regulation came into force, there is a high probability that most crypto exchanges would have to pay a generally applicable GST of 18%.
This would ultimately mean a gigantic inflow of funds into the state budget. Recall the latest statistics, which claim that investments from this country in cryptocurrencies have increased by an incredible 19,900% over the last year.
Chainalysis estimates that total investment in cryptocurrencies in India has risen from $ 200 million to $ 40 billion over the past year. Another important finding is the number of Indians who trade in cryptocurrencies, which is estimated at 15 million.