Indian regulator proposes 18% tax on Bitcoin Trading

The Central Economic Intelligence Bureau (CEIB) proposes to tax cryptocurrency trading at 18%. The agency classifies bitcoin as an “intangible asset”, reports The Times of India.

This is a Goods and Services Tax (GST). The government is currently considering a proposal that would levy a tax on every bitcoin transaction and margin trading.

The sharp rise in trading volume in cryptocurrencies occurred after the Supreme Court overturned a two-year ban from the Reserve Bank of India (RBI) on serving cryptocurrency companies.

The average daily trading volume on the top four Indian cryptocurrency exchanges as of December 29, 2020, was over $ 36 million, up from just under $ 4.5 million as of March 1, 2020.

Trading volume on crypto exchanges in India for March (first column) and December (second column)

The annual turnover of bitcoin trading in India is $ 5.45 billion, the cryptocurrency is not regulated. As of now, crypto exchanges in India continue to operate without regulatory compliance.

Recall that in July 2020, Prime Minister Narendra Modi announced the need to develop the Internet of Things, Big Data, blockchain, and 5G.

Earlier, venture capitalist and billionaire Tim Draper said he was studying the investment attractiveness of Indian crypto startups.

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