‘No intention to evade tax,’ India crypto exchange WazirX responds to ongoing investigation
Major cryptocurrency service providers are under investigation in India on suspicion of possible tax evasion. However, Zanmai Labs’ WazirX had recently come under fire for alleged evasion of 400 million rupees in goods and services tax (GST), after ₹492 million were reportedly recovered from the exchange as tax and penalty.
Treading the thin line
Now in response, WazirX noted that the company has been diligently paying GST worth millions every month, and there was no intention to evade taxation. The company spokesperson said,
“There was an ambiguity in the interpretation of one of the components which led to a different calculation of GST paid. However, we voluntarily paid additional GST in order to be cooperative and compliant. There was and is no intention to evade tax.”
Further adding that more clarity on taxation rules by the lawmakers can help the industry players. On the recent crackdown, the spokesperson said,
“We clarified their doubts and also voluntarily paid the GST to clear their dues.”
Meanwhile, with an expectation of the scrutiny to “intensify” in the coming days, crypto industry executives are also asking the government to make the “applicable provisions” clear.
Amid the taxation chaos, the players have blamed the discrepancy on the amount of tax due for crypto businesses on this very confusion. Unocoin co-founder Sathvik Vishwanath told ET,
“They (DGGI) are looking at the different models and asking us for an explanation on how we account for transactions and they’re collecting the GST that was missed.”
Further adding there were “some business model categorization issues because of which it was unclear how much tax the (crypto) exchanges need to pay.”
Rameesh Kailasam, president and CEO of tech lobby IndiaTech said to the paper,
“They (GST authorities) are coming up with their own explanations. Not everything is named in law and how to be taxed but we presume that certain goods are treated in a particular way.”
AMBCrypto had previously reported citing local media, that “government was planning to compartmentalize virtual currencies and their tax treatment on the basis of their use case — payments, investment, or utility.” Though the crypto bill didn’t make it to the Parliament’s table last year, it is expected to soon bring an end to the industry woes.
Also Read: India: both Income tax and GST may apply to cryptoSource