The Directorate General of GST (DGGI) on Saturday raided the officers of several prominent cryptocurrency exchanges in India, ANI reported citing an insider source.
The report said the DGGI raided the offices of WazirX over unpaid GST of Rs 40.5 crore, with RS 49.2 crore in cash recovered pertaining to GST “evaded, interest and penalty”.
According to the report, WazirX’s proprietary token, WRX, was the subject of the evasion. Commissions are charged on every transaction done through the exchange. WazirX charges a commission of 0.2 per cent for rupee transactions and 0.1 per cent on WRX transactions.
The report alleges that GST was paid only on commissioned earned in rupee transactions and not on those earned in WRX. “A GST at the rate of 18 per cent is applicable on these transaction fees. GST of Rs. 40.5 crores was not paid, which was paid along with interest and penalty on December 30. Total Rs. 49.2 crores have been recovered on the spot from the WazirX,” it said.
“The CGST department will cover all the cryptocurrency exchanges falling in the Mumbai zone and will also intensify this drive in the coming days,” stated the release.
With no regulatory framework in place for cryptocurrency transactions in India, there has been a lack of clarity on the exact provisions and categories under which cryptocurrencies would be considered for tax purposes.
Reports that cryptocurrencies would be treated as assets and not as currencies have emerged. However, their taxability has yet to be clarified. The Securities and Exchange Board of India (SEBI) was expected to be given the onus of regulating cryptocurrencies as “crypto-assets”, according to a Mint report.