The Indian Government has hinted at possible taxation of Bitcoin transactions in the country. According to reports, Bitcoin trading could attract a fee of up to 18% in India following a recent proposal to impose a “Goods and Services (GST)” tax on Bitcoin.
This new proposal could generate up to Rupees 40,000 crores ($5.45 billion) annually considering India’s position in the global bitcoin market. India currently has one of the biggest cryptocurrency markets in the work, ranking second in Asia on the list of countries with the most amounts of Bitcoin trades. In 2020 alone, the country has traded over $74 million worth of Bitcoin. This is an increase of $347% from 2019.
To date, India has not openly come out to voice its stance against or for cryptocurrencies. However, the government has been quite stringent. The sharp increase in trading volumes from the country came after the Supreme Court lifted a two-year ban that was earlier imposed by the Reserve Bank of India (RBI).
As per the proposal, it was put forward by an arm of the country’s finance ministry – the Central Economic Intelligence Bureau (CEIB). Under the Goods and Services tax, Bitcoin would be considered an intangible asset.