Starting February 1, 2025, the Indian government will enforce stringent measures on cryptocurrency holders with penalties for undeclared gains. This follows new tax legislation introduced in the country's budget.
Cryptocurrency Tax Changes in India
The Indian government has amended the Income Tax Act, classifying crypto assets as 'Virtual Digital Assets'. These changes require crypto exchanges and financial institutions to report all transactions to tax authorities.
Impact on Crypto Holders
Crypto holders in India must adhere to new mandates, including reporting transactions. Unreported gains from the past four years will incur penalties up to 70%.
Government Actions on Crypto
In December 2024, Indian authorities uncovered ₹824 crore in unpaid taxes due to undeclared goods and services by crypto companies. This illustrates increased government enforcement in the cryptocurrency sector.
India's tighter control over the cryptocurrency market with new tax obligations can reshape the industry's dynamics and have significant implications for investors.
