Since the Supreme Court’s decision to lift the banking ban on crypto enforced by the Reserve Bank of India, the country’s digital asset exchanges are seeking clarity on their taxation obligations. According to the India Times report, several of India’s crypto exchanges collectively penned a letter to the RBI, claiming that the current lack of regulatory clarity has led to banks continuing to deny services to exchanges dealing with crypto.
Indian crypto exchanges want regulatory clarity.
According to the report, crypto exchanges have also reached out to India’s high court regarding the matter. The exchanges want clarifications if their operations will be classified as dealing with goods, currencies, commodities, or services to ascertain whether they are subject to the country’s Goods and Service Tax. Chairman & CEO Belfrics Global, Praveenkumar Vijayakumar, said that if the cryptocurrencies are not exempted from GST, then crypto exchanges in India are going to have a standoff with the tax authority. In the wake of the recent Supreme Court ruling, we have also approached the central bank for clarity on this, as if we pay GST on the whole transaction, then most companies would not be able to survive, he added.
Several banks deny receiving any revised notification from the RBI.
Sidharth Sogani, the CEO of digital asset research firm Credbaco Global, said that the RBI was supposed to issue a new circular directing the banks to start banking relationships again with crypto exchanges and businesses. The CEO claimed that many banks are denying having received any notification from the central bank when approached by crypto exchanges looking to do business. The co-founder and CEO of the crypto exchange Unocoin, Sathvik Vishwanath, said that India’s population is highly underrepresented in the crypto-asset markets.
Currently, with the economic recession due to the coronavirus pandemic. People are more relying on cash at such times than crypto as physical cash can be used to buy essential goods.
