Indian Tax Authorities knock on the doors of Bitcoin Exchanges. Investors beware!
The long and rich “party” held by Bitcoin exchanges and investors in India is soon going to be gatecrashed by the Tax Authorities in India. The Taxation Authorities are investigating all the exchanges that help people trade Bitcoins on, across the nation. Major states like Mumbai, Delhi, Bengaluru, Hyderabad and Pune are already under the scrutiny.
The Tax Authority is looking forward to collect information regarding the basic operation of Bitcoins in the country, including the sources, the investors, the money involved, sources of investment and also there might be a future possibility of collecting tax on the same.
The regulators have been worried about the prices of Bitcoins which have been soaring high in the past few months. The prices for the same on November 1, 2017 was approximately Rs. 4.50 Lakhs. This price has soared way high to about Rs. 13.80 Lakh around December 14, 2017. This skyrocketing of prices has generated an interest among people for cryptocurrencies, engagement on sites like cointree.com, and the purchasing volume for the same has doubled in just over a month.
RBI as well as the Finance Minister of India, Arun Jaitley have already warned the residents of India about the potential threat the cryptocurrency could cause to India and the people. Investment in the same could bring in its share of problems to the people of the country. RBI again has issued a cautionary note saying and reiterating these warning again. Their concern was seen in the circular they issued again on December 5, 2017.
The Ministry of Finance is also concerned about the development of the cryptocurrencies. They are of the view that these currencies can be used to launder money and commit all kinds of frauds. A Panel thus, has been set up by the Secretary of Economic Affairs and the Ministry together. The Panel comprises of member of the Stock Market and the Banking sectors to determine the actual position of India as far as virtual currency is concerned.
The cryptocurrencies, though a rage among many people and a bone of contention among the authorities and the people in India, are still not illegal. The stock exchanges in India have said that they follow all verification procedures from the basic and electronic ‘know your customer’ to checking the Aadhaar Number in order to prevent any form of fraudulent practice. Moreover, most of the stock exchanges do not accept money in the form of cash or cheque. All transactions are performed online.
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