GST Council Mulls Sales Tax On Cryptocurrency Next Week

A ministerial panel is scheduled to hold a meeting next week to discuss a goods and services tax on cryptocurrency transaction, according to a Bloomberg report. People with information on the matter said, the panel is expected to include federal and states' finance ministers. The panel seeks to broaden the tax ambit to track dealings in virtual digital assets in a far more effective way, added the Bloomberg report.

The panel is scheduled to meet for two days beginning June 28, 2022 in Chandigarh, said the people on the condition of anonymity.

As per Bloomberg's report, the panel may not finalize a rate in the upcoming meeting. However, discussions are likely to take place on placing it in the highest tax slab of 28%, revealed people with information on the matter.

Earlier, Finance Minister Nirmala Sitharaman had imposed a levy of 30% on income from transfer of virtual assets and a 1% tax at source on all crypto transaction to identify the crypto market size in India and track users.

Presently, there is lack of clarity on imposition of a sales tax on digital currency as a result of ambiguity in its treatment as goods or services and a lack of regulatory framework, added the Bloomberg report.