Skip to main content

Indian taxman recovers $6.62M from WazirX for evading tax on commission

Government officials from CGST Mumbai Zone recovered the funds from crypto exchange WazirX after detecting a GST evasion of $5.43 million on trade commissions.

Indian crypto exchange WazirX has reportedly paid over $6.6 million (49.2 crore rupees) following non-payment of Goods and Services Tax (GST) on trade commissions. The total recovery includes the pending tax of $5.43 million (40.5 crore rupees), the interest and a penalty for non-payment.

Government officials from the Central GST and Central Excise committee (CGST Mumbai Zone) recovered the funds from the crypto exchange after detecting a GST evasion of $5.43 million on the commissions. A typical GST fraud involves creating fake invoices without actually moving the goods between the seller and the buyer.

According to local media Economic Times, the tax department detected that WazirX uses its in-house WRX tokens for commissions, which were distributed by Zanmai Labs. Further investigation revealed that the crypto exchange missed out on paying 18% tax on the total tokens issued based on its market price.

The investigators revealed that WazirX paid GST on the 0.2% commission it charges users for making trades with local currency i.e. the rupee, clarifying:

“But in cases where the trader opts for transaction in WRX coins, the commission charged is 0.1% of trading volume and they were not paying GST on this commission.”

It is also important to note that WazirX and WRX tokens are owned by Binance, the world’s biggest crypto exchange in terms of the trading volume. According to a Zanmai Labs spokesperson, the non-payment of tax was related to the misinterpretation of GST rules:

“We voluntarily paid additional GST in order to be cooperative and compliant. There was and is no intention to evade tax.”

WazirX CEO Nischal Shetty previously told Cointelegraph about the importance of regulatory clarity for retail adoption. He also warned that an overnight regulation may harm the progress of the crypto ecosystem and leave open loopholes for bad actors:

“There is a $2.5-trillion market out there, and it is not going to wait for any nation to come on board. I’ve been tweeting ‘#IndiaWantsCrypto’ for over 1,000 days with the sole objective of having crypto regulation in India.”

While the concept of GST is fairly new in the region, the government of India has previously agreed to show leniency to defaulters and fraudsters — typically settling such cases with a monetary penalty and a lower probability of jail time. 

WazirX has not yet responded to Cointelegraph’s request for comment.

Related: Indian trade group recommends ‘special class security’ status for crypto

In an attempt to help the Indian government decide crypto laws, the Confederation of Indian Industries (CII) proposed to treat cryptocurrencies as securities of a special class.

A report released by the non-government trade association showed the CII proposes to formulate new regulations around the nascent crypto market instead of regulating them under existing securities law.

As Cointelegraph reported, the CII recommended a special provision of income tax and GST laws, which will treat cryptocurrencies as an asset class for tax purposes unless specifically treated as “stock in trade“ by a participant.



from https://ift.tt/3sMBl76
https://ift.tt/3qHptjY
Labels:

Comments

Post a Comment

Any questions, Please.

Popular posts from this blog

Five Bitcoin Price Charts Analyzing The Dramatic Q1 2022 Conclusion

There are only hours remaining until the Q1 2022 close in Bitcoin price action. With the important quarterly candle set to close tonight, let’s look at what technicals might say about the direction of the next quarter. Q1 2022 Comes To A Close For Bitcoin The first quarter of a year, often sets the tone for the year to come. In investments, a poor Q1 performance is indicative of a bad year ahead. Considering the fact that Bitcoin price is now above $45,000 after touching $32,000 this quarter, it is tough to say the performance has been “poor” by anything other than crypto standards. Related Reading | Bitcoin Weekly Momentum Flips Bullish For First Time In 2022 The cryptocurrency has recovered nearly 40% from the low, leaving a long wick behind. Such a long wick suggests that before the quarter came to a close, buyers stepped up in a major way. Buyers were able to step up in a larger capacity in Q1 2022 than bears were able to in the final quarter of last year. The bearish wick to cl...
Post a Comment
Read more

FTX hacker reportedly transfers a portion of stolen funds to OKX after using Bitcoin mixer

On-chain activity suggests that the hacker has sent at least 225 BTC (4.5 million) to OKX so far. Hackers who drained FTX and FTX USA of over $450 million worth of assets just moments after the doomed crypto exchange filed for bankruptcy on Nov. 11, continue to move assets around in an attempt to launder the money.  A crypto analyst who goes by ZachXBT on Twitter alleged that the FTX hackers have transferred a portion of the stolen funds to the OKX exchange, after using the Bitcoin mixer ChipMixer. The analyst reported that at least 225 BTC — worth $4.1 million USD — has been sent to OKX so far.  1/ Myself and @bax1337 spent this past weekend looking into the FTX attacker’s deposits to ChipMixer. It appears they’ve likely been transferring a portion of the stolen FTX funds to OKX after withdrawing from CM So far we’ve accounted for at least $4.1m (255 BTC) sent to OKX pic.twitter.com/C46JZWtktn — ZachXBT (@zachxbt) November 29, 2022 According to ZachXBT, the FTX h...
Post a Comment
Read more

2 metrics signal the $1T crypto market cap support likely won’t hold

Despite the 8.5% weekly rally in cryptocurrencies, the lack of stablecoin premiums in Asia and futures markets activity shows buyers’ lack of confidence. Cryptocurrencies broke the $1 trillion market capitalization resistance on Oct. 26, which had been holding strong for the previous 41 days. Despite Bitcoin’s ( BTC ) modest 5.5% weekly gains, the aggregate value of 20,000 listed tokens increased by 8.5% between Oct. 24 and 31. Total crypto market cap, USD (in billions). Source: TradingView The cryptocurrency market was positively impacted by a 6.3% weekly rally in the Russell 2000 mid-capitalization stock market index. Some encouraging news accompanied the positive tailwinds from traditional markets. For instance,  55,000 BTC was withdrawn from Binance on Oct. 26, a record high. Typically, analysts consider the reduced number of coins deposited on exchanges a bullish indicator, as the immediate selling pressure eases. Moreover, exchange and wallet provider Blockchain.com ...
Post a Comment
Read more