Indians may be charged an additional 2% tax on bitcoin and crypto purchased abroad

Bitcoin (BTC) and other cryptocurrencies purchased from exchanges outside of the country may incur additional taxes for Indian investors while the tax department reviews whether or not cryptocurrencies are subject to a balanced 2% tax rate. report the Business hours.

Google tax

Services offered in India by overseas e-commerce companies are subject to a balanced tax, colloquially known as the “Google Tax,” but experts are still unsure how to apply them to e-money.

“The way the new balanced tax is communicated and defined seems likely that it will also apply to cryptocurrencies bought from an exchange that is not based in India,” said tax expert and founder. Girish Vanvari told the Economic Times, adding:

“If there are no guidelines on how to deal with crypto assets, there will be confusion about how they will be treated under tax law and the Foreign Exchange Management Act.”

According to his interpretation, the tax normally levied on overseas companies would be added to the selling price, meaning exchanges could add it to the cost of the cryptocurrency.

Lack of principles

In 2020 India extended the scope of the same tax rate to “e-commerce supplies or services”, not excluding business-to-customer transactions.

The 2021 Finance Act clarifies that the balanced tax rate now fully includes online marketplaces that act as intermediaries between buyers and sellers as it clarifies terms not defined in the 2016 Finance Act that introduced this tax, as well as the 2020 Finance Act it expands.

The country has yet to classify cryptocurrencies, and the lack of a regulatory framework makes it harder to understand the implications of a balanced tax.

Lawmakers in India recently sent mixed signals about Bitcoin, from warranty Come classify It’s like an asset.

Will the tax law speed up this process or have you found a way to completely eliminate the problem until you have made up your mind?