India Intensifies Crypto Tax Crackdown With 44,000+ Notices to Traders

India's Income Tax Department has escalated its campaign against crypto tax evasion, issuing over 44,000 compliance notices to traders who failed to report VIRTUAL digital asset (VDA) transactions. Minister of State for Finance Pankaj Chaudhary disclosed the enforcement measures during a Rajya Sabha session, highlighting reassessment notices, surveys, and search operations under the Income Tax Act.

The Central Board of Direct Taxes (CBDT) deployed its NUDGE program—Non-Intrusive Usage of Data to Guide and Enable—to prompt voluntary disclosures through targeted emails and messages. Since implementing crypto income taxation in FY2022-23, taxpayers have declared ₹705 crore ($80.6 million) in crypto-linked income. Enforcement actions uncovered an additional ₹630 crore ($72 million) in unreported gains.