Tax on digital assets could go up, govt mulling GST on crypto mining, supply

economictimes.indiatimes.com:

GST) on various cryptocurrency transactions including mining of these digital assets. The issue is being examined internally at the Central Board of Indirect Taxes and Customs (CBIC) and a proposal will be taken to the GST Council, CBIC chairman Vivek Johri said. «There are several aspects of the operation which intersect with GST as a tax,» he said in an interview to ET. The budget has proposed a flat 30% capital gains tax on virtual digital currencies beginning April 1, 2022. The levy of GST on other transactions in them could raise the overall incidence of tax on cryptocurrencies.

Did you Know?

Sunny Leone took the lead among Indian actors to secure her digital assets when she broke the news about her association with NFT, two months back. This made her the first Indian actress to mint NFTs

Services provided by a platform, or an exchange operator, were duly recognised as taxable services and authorities have been charging them to tax, Johri said.CBIC will Take 2-3 Months However, the issue of supply of cryptocurrencies required more detailed examination, Johri added. «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 added. Asked if it would be taken to the GST Council at its next meeting expected sometime in March, he said: «We're trying, but it has to go through the process