Claim Giveaway Token Proof of Reserve

Exchange Tax Evasions are Being Labelled as Crypto Frauds in India

  • Union Finance Minister informed the nation that ED has collected over 907 Crores INR in the criminal proceedings against three individuals for money laundering

  • However, the Ministry did not highlight the fact that there were no clear taxation guidelines on the crypto transactions at the time at which the evasions were reported

  • We have to understand that cryptocurrencies and smart contracts cannot be modified for any personal benefits or financial malpractices


Exchange Tax Evasion

While Addressing the Lok Sabha this Monday, Union Finance Minister 

Informed the nation that ED has collected over 907 Crores INR in the criminal proceedings against three individuals for money laundering. 

According to the report shared by the Ministry of Finance, the accused were using cryptocurrency exchanges to launder money in India. Mr Chaudhary while replying to the questions of MP Umesh Jadhav, Tejasvi Surya, and others, informed the house that four prosecution complaints were filed in Special Court, Prevention of Money Laundering Act (PMLA).

“Proceeds of crime amounting to Rs 907.48 crore have been attached/seized, three persons have been arrested, and four prosecution complaints have been filed before the Special Court, PMLA (Prevention of Money Laundering Act) in these cases.” - Pankaj Chaudhary, Union Minister of State for Finance

As per the information shared by the Union Minister, 12 cryptocurrency exchanges operating in India were found to be evading taxes worth no less than 87 Crore INR which reaches over 110 Crores INR after levying interests and penalties. 

However, the Ministry did not highlight the fact that there were no clear taxation guidelines on the crypto transactions at the time at which the evasions were reported. It is also possible that the authorities are implementing current regimes to tax the earlier transactions of the exchanges.

The ministry also shared that ED has given a show-cause notice to Zimani Labs Pvt. Limited aka WazirX under Foreign Exchange Management Act (FEMA). The cited cause for the investigation was a crypto transaction worth Rs. 2,790.74 crores on the centralized exchange. 

The point here to note is that none of the above-mentioned investigations has anything to do with cryptocurrencies or blockchain technology. The mentioned activities were not crypto frauds but cases of tax evasion, a common problem of traditional finance. However, the traditional media took no time to share the information as mere crypto fraud because the involved parties were centralized exchanges. 

We have to understand that cryptocurrencies and smart contracts cannot be modified for any personal benefits or financial malpractices. Everything in the blockchain is available to all and open to public scrutiny. 

The unregulated cryptocurrency space in the country is enabling the bad actors to use the cryptocurrencies to their advantage and as the Union Minister said, we are working towards building a global consensus on crypto regulations and making this space a better place for all.

Also, Read - Should you Invest in Bitcoin? How to Invest in Bitcoin? | CoinGabbar

WHAT'S YOUR OPINION?
Related News
Related Blogs
`