Indian users of Bybit will now pay GST (Goods and Services Tax) on a range of cryptocurrency transactions. Bybit’s announcement complies with India’s crypto tax rules as the international exchange seeks to deepen its ties in the country.
Bybit Imposed 18% GST Burden On Users
According to an official announcement, cryptocurrency exchange Bybit says Indian users are required to pay GST on certain transactions. Per the announcement, users of the exchange will pay an 18% GST in line with Indian cryptocurrency tax rules.
At the moment, the Indian tax code mandates cryptocurrency exchanges to charge 18% GST on service fees and trading fees. To comply with the rules, Bybit says users will begin paying the tax on July 7 across a raft of products.
Right of the bat, users will pay GST on service fees acruing from all spot and margin trading. Furthermore, the GST will apply to derivatives and unified trading account (UTA) transactions. Going forward, users will pay GST on fiat deposit and withdrawals, purchases with bank cards, crypto withdrawals, and the conversion of small balance to MNT OTC trading.
“In accordance with Indian tax regulations, GST applies to the service component of transactions,” read the announcement. “For crypto trades, this includes the spread – the difference between the buy and the sell price – which is considered a part of the service provided by the platform.”
Furthermore, GST will be paid on new crypto loans, margin staked SOL, Earn, and Bybit pay transaction. Bybit remits the GST received from customers to the Central Board of Indirect Taxes.
Bybit disclosed that it will shut down its legacy crypto loans, Bybit cards and a range of trading bots for Indian users. Amid the wholesale changes, Bitget has partnered with Mastercard and Immersve to launch a zero-free crypto card.
India’s Strict Crypto Tax Rules
India has come under fire for its stifling cryptocurrency tax rules. At the moment, Indian crypto traders have to pay a 30% capital gains tax, an additional 1% TDS (tax deductible at source) plus an 18% GST. Despite the flurry of taxes, India is reassessing its crypto tax regulation, aligning rules with international best practices.
While several exchanges have borne the brunt of the GST, a growing number of exchanges like Bybit are passing the weight to users. To sidestep the strict tax rules, Indian traders are adopting foreign crypto exchanges, avoiding GST and TDS.
Others are ditching centralized exchanges altogether for peer-to-peer (P2P) solutions. A growing number of traders are abandoning high-frequency trades to avoid the 1% TDS on every transactions.
In the US, Senator Cynthia Lummis has introduced a new bill to reduce taxes on Bitcoin transactions. The bill seeks to remove the tax requirement on Bitcoin transactions under $300 and prevent doubled taxation for miners.
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Aliyu Pokima
Aliyu Pokima is a seasoned cryptocurrency and emerging technologies journalist with a knack for covering needle-moving stories in the space. Aliyu delivers breaking news stories, regulatory updates, and insightful analysis with depth and precision. When he’s not poring over charts or following leads, Aliyu enjoys playing the bass guitar, lifting weights and running marathons.
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