First Major Tax Raid on Bitcoin Exchanges Underway Across India

First Major Tax Raid on Bitcoin Exchanges Underway Across India

New Delhi (Sputnik) India’s income tax department has unleashed a countrywide raid on Bitcoin exchanges on suspicion of alleged tax evasion. Tax officials have been inspecting the documents of at least nine Bitcoin exchanges in Delhi, Bengaluru, Hyderabad, Kochi and Gurugram since early morning Wednesday.

“The income tax officials are gathering evidence to establish the identity of investors and traders, the transactions undertaken by them, the identity of counterparties, and the related bank accounts used, among other things,” an income tax official told the PTI.

The raid is being conducted following a report of massive investment in Bitcoins and other cryptocurrencies in recent months by various individuals and entities.

Industry body Assocham has reported that Bitcoin is attracting an average of 3,500 new users/entrants per day in India alone. It also said that Bitcoin and other virtual currencies are gulping down a major proportion of surplus savings in the economy, threatening to derail the financial structure.

READ MORE: ‘Digital Gold’: Telegram Founder Shares His Stance on Bitcoin

Meanwhile, the income tax department is also mulling imposing a tax on the income generated from virtual currencies like Bitcoin, sources told Sputnik. Current provisions in India’s income tax law allow the government to impose a tax on such undeclared income by counting them as assets.

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