India Uncovers $72M in Hidden Crypto Earnings as Tax Crackdown Intensifies
Crypto tax dodgers, beware—India’s revenue sleuths just struck digital gold.
The Hunt Heats Up
Authorities flushed out $72 million in undeclared crypto income—proof that blockchain anonymity isn’t bulletproof when taxmen go blockchain-savvy. No more ‘lost wallet keys’ as excuses.
Compliance Gets Teeth
From Mumbai traders to Delhi hodlers, the message is clear: report it or regret it. The government’s tightening screws on crypto tax evasion—because nothing inspires compliance like the fear of getting audited (or worse).
The Irony Wears a Suit
Meanwhile, traditional bankers clutch pearls over crypto’s ‘wild west’—while their offshore accounts do the Macarena. Priorities.
Tackling tax evasion
To address the significant amount of undeclared tax income, Indian authorities have issued over 44,000 notices to individuals and organizations that failed to report crypto-related earnings.
The authorities stated that this enforcement is part of a broader strategy to bring transparency to the digital asset economy and ensure a stronger culture of tax compliance.
Chaudhary further revealed that CBDT has implemented several data analysis tools, including the Non-Filer Monitoring System (NMS) and Project Insight, to improve reporting accuracy.
These systems cross-reference VDA transaction data with taxpayer disclosures, such as Income Tax Returns (ITRs) and TDS returns filed by Virtual Asset Service Providers (VASPs), allowing authorities to spot discrepancies and take appropriate action.
However, some industry leaders argue that the current tax structure may be counterproductive.
CoinDCX CEO Sumit Gupta pointed out that the combination of a 30% capital gains tax and a 1% tax deducted at source on every trade has driven millions of Indian traders toward offshore platforms, where oversight is limited. This shift not only weakens local participation but also erodes potential revenue.
Gupta suggests that India could substantially boost its annual crypto tax intake, potentially exceeding ₹5,000 crore, by making the domestic trading environment more competitive. He maintains that a more balanced policy WOULD encourage long-term investment and reduce the appeal of offshore exchanges, paving the way for India to become a global hub for digital finance.
