tl;dr
The Indian government has discovered substantial unpaid Goods and Services Tax (GST) liabilities from cryptocurrency exchanges, with firms like Binance and WazirX owing a combined $97 million in unpaid taxes. The government has already recovered $14 million in taxes, penalties, and interest from som...
The Indian government has uncovered significant unpaid Goods and Services Tax (GST) liabilities from cryptocurrency exchanges, including Binance and WazirX, totaling $97 million. 17 crypto companies have been charged for tax evasion, with Binance owing $85 million in unpaid taxes. Binance is currently facing regulatory challenges and backlash, including a whistleblower lawsuit and listing controversial coins. Meanwhile, WazirX continues to grapple with challenges post-hack, with customer withdrawals suspended and ongoing legal actions. The intensified scrutiny reflects a broader regulatory crackdown on the cryptocurrency sector in India.
According to a statement by India’s Minister of State for Finance, the government has already recovered $14 million in taxes, penalties, and interest from some of the entities involved. The investigation identified and charged 17 crypto companies for tax evasion. WazirX owes 40.5 crore rupees ($4.8 million), CoinDCX 16.84 crore rupees ($1.9 million), and CoinSwitch Kuber 14.13 crore rupees ($1.7 million). While most firms on the list have settled their dues, companies like Binance and Hyperux Technologies remain non-compliant. Binance reportedly owes 722 crore rupees ($85 million) in unpaid taxes. This amount has not been recovered, as it was excluded from the total recovered sum announced by the government.
The tax issue adds to a series of challenges Binance is currently facing. Last week, Amrita Srivastava, a former senior employee at Binance’s Link platform, filed a whistleblower lawsuit in the UK. Srivastava claims she was wrongfully terminated after reporting alleged misconduct, including a colleague’s bribe solicitation. In addition, Binance faced backlash in November for listing two Solana-based meme coins, The AI Prophecy (ACT) and Peanut the Squirrel (PNUT), with critics accusing the exchange of enabling pump-and-dump schemes. On the other hand, WazirX has continued to face critical challenges since its $235 million hack in July, with customer withdrawals still suspended.
The Indian government’s intensified scrutiny highlights a broader regulatory crackdown on the cryptocurrency sector, with tax evasion and security concerns remaining central issues.