Latest news with #VirtualDigitalAssets
Economic Times
2 days ago
- Business
- Economic Times
Rs 437 crore tax collection: For crypto traders, evading income tax is getting difficult as Tax Dept uses AI, data analytics tools
ET Online Crypto tax In India, avoiding taxes on bitcoin, cryptocurrencies, and other virtual digital assets is becoming increasingly difficult. The Income Tax Department is increasing its efforts to monitor transactions related to the virtual digital assets (VDAs) made by individuals. This is being done through the use of artificial intelligence (AI), machine learning, and other data analytics tools. According to the government's reply in the Parliament, the government has collected Rs 437 crore in taxes for FY 2022-23 from VDA-related income. The government implemented income tax rules for crypto and other VDAs from FY 2022- 23. In FY 2022-23, the government collected Rs 269.09 crore in taxes from VDA income. Also read: Indian Railways has deactivated 2.5 crore IRCTC user IDs: Has yours also been deactivated? Check now Members of Parliament asked several questions regarding tax collection, potential revenue loss due to under-reporting/mis-reporting from VDAs' income and the technological tools being used to monitor crypto activity. ET Wealth Online breaks down the government's responses on the use of data tools, centralised systems for matching crypto tax data, and ongoing training programs for tax officers. Questions on income tax collection from VDAs, cryptocurrency Parliamentarians Lavu Sri Krishna Devarayalu and G M Harish Balayogi, Members of Parliament, Lok Sabha, asked the following questions and the government's response in the Parliament. a) The total revenue collected from income tax on VDA/cryptocurrency-related income during the last three years, year-wise; The government in the Parliament replied: The tax on income from transfer of Virtual Digital Assets (VDA), under section 115BBH of the Income Tax Act, 1961, was introduced from FY 2022-23. The collection of tax on income from VDA, for last three years is as under:Table (b) whether any estimates have been made by the Government regarding the projected revenue loss due to under-reporting/misreporting of income from VDA/cryptocurrency transactions; The government in Parliament replied: No such estimates have been made. (c) Whether the government is using AI/ML/data analytics tools to identify tax evasion in VDA transactions, if so, details thereof; The government in Parliament replied: The government is utilising data analytics tools to trace and detect tax evasion from VDA-related transactions. The analysis includes the use of Non-Filer Monitoring System (NMS), project insight and internal databases of the Income Tax department, to correlate available information on VDA transactions with the transactions disclosed in the return of income by the taxpayer.(d) Whether a centralised system has been established by the Government for real-time matching of VDA-related ITR filings with TDS returns filed by Virtual Asset Service Providers (VASPs), if so, the status of its implementation; andThe government in Parliament replied: Real time matching of VDA related transactions, filed in income tax returns, with information filed by Virtual Asset Service Providers (VASPs) is not being carried out. However, TDS returns filed by VASPs and income tax returns filed by the taxpayers are analysed to identify discrepancies in reported VDA transactions. The Central Board of Direct Taxes has initiated the NUDGE (Non-Intrusive Use of Data to Guide and Enable) campaign to identify such discrepancies for further action. Under NUDGE campaign suitable communications, to review and update their income tax returns, were issued to all taxpayers who did not report VDA-related transactions in their income tax returns, despite tax being deducted at source for such transactions by VASPs, where the quantum of such discrepancy was more than Rs 1 lakh. (e) Whether the Government has undertaken any capacity-building initiatives to equip tax officials for effective compliance monitoring and investigation in the VDA/cryptocurrency ecosystem, if so, the details thereof and if not, the reasons therefor?The government in the Parliament replied: Several capacity-building initiatives are being undertaken by the Government to equip officers for effective compliance monitoring and investigation of VDA related transactions. Training programs, specialized workshops, Chintan Shivirs and hands-on workshops are regularly conducted by various training institutes under the Income Tax Department. At local level, field offices conduct training sessions and webinars on digital forensics, blockchain analysis, legal frameworks, and handling of digital evidence. The officers and officials are also imparted short term training on digital forensics, in partnership with National Forensic Science University (NFSU), Goa, which empower them to identify and trace VDA related transactions from data captured during intrusive actions. Penalty for not disclosing crypto earnings According to a report in The Economic Times, the Income Tax Department has sent bulk notices to taxpayers who have either not paid the correct income tax amount or failed to report income from cryptocurrency in their tax returns. Also Read | Didn't report your crypto earnings? Income tax dept sending tax notices, conducting search undefined know your options If an individual taxpayer fails to report crypto transactions, they may be liable to pay a penalty under Section 270A of the Income Tax Act, 1961. Under this section, a taxpayer is liable to pay a sum equal to fifty per cent of the amount of tax payable on under-reported income. If the under-reported income is in consequence of any misreporting of income, then it is equal to two hundred per cent of the amount of tax payable on the under-reported income. N.R. 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Time of India
2 days ago
- Business
- Time of India
Rs 437 crore tax collection: For crypto traders, evading income tax is getting difficult as Tax Dept uses AI, data analytics tools
Academy Empower your mind, elevate your skills Questions on income tax collection from VDAs, cryptocurrency Penalty for not disclosing crypto earnings In India, avoiding taxes on bitcoin, cryptocurrencies, and other virtual digital assets is becoming increasingly difficult. The Income Tax Department is increasing its efforts to monitor transactions related to the virtual digital assets (VDAs) made by is being done through the use of artificial intelligence (AI), machine learning, and other data analytics tools . According to the government's reply in the Parliament, the government has collected Rs 437 crore in taxes for FY 2022-23 from VDA-related government implemented income tax rules for crypto and other VDAs from FY 2022- 23. In FY 2022-23, the government collected Rs 269.09 crore in taxes from VDA read: Indian Railways has deactivated 2.5 crore IRCTC user IDs: Has yours also been deactivated? Check now Members of Parliament asked several questions regarding tax collection, potential revenue loss due to under-reporting/mis-reporting from VDAs' income and the technological tools being used to monitor crypto Wealth Online breaks down the government's responses on the use of data tools, centralised systems for matching crypto tax data, and ongoing training programs for tax Lavu Sri Krishna Devarayalu and G M Harish Balayogi, Members of Parliament, Lok Sabha, asked the following questions and the government's response in the Parliament.a) The total revenue collected from income tax on VDA/cryptocurrency-related income during the last three years, year-wise;The government in the Parliament replied: The tax on income from transfer of Virtual Digital Assets (VDA), under section 115BBH of the Income Tax Act, 1961, was introduced from FY 2022-23. The collection of tax on income from VDA, for last three years is as under:Table(b) whether any estimates have been made by the Government regarding the projected revenue loss due to under-reporting/misreporting of income from VDA/cryptocurrency transactions;The government in Parliament replied: No such estimates have been made.(c) Whether the government is using AI/ML/data analytics tools to identify tax evasion in VDA transactions, if so, details thereof;The government in Parliament replied: The government is utilising data analytics tools to trace and detect tax evasion from VDA-related transactions. The analysis includes the use of Non-Filer Monitoring System (NMS), project insight and internal databases of the Income Tax department, to correlate available information on VDA transactions with the transactions disclosed in the return of income by the taxpayer.(d) Whether a centralised system has been established by the Government for real-time matching of VDA-related ITR filings with TDS returns filed by Virtual Asset Service Providers (VASPs), if so, the status of its implementation; andThe government in Parliament replied: Real time matching of VDA related transactions, filed in income tax returns, with information filed by Virtual Asset Service Providers (VASPs) is not being carried out. However, TDS returns filed by VASPs and income tax returns filed by the taxpayers are analysed to identify discrepancies in reported VDA transactions. The Central Board of Direct Taxes has initiated the NUDGE (Non-Intrusive Use of Data to Guide and Enable) campaign to identify such discrepancies for further action. Under NUDGE campaign suitable communications, to review and update their income tax returns, were issued to all taxpayers who did not report VDA-related transactions in their income tax returns, despite tax being deducted at source for such transactions by VASPs, where the quantum of such discrepancy was more than Rs 1 lakh.(e) Whether the Government has undertaken any capacity-building initiatives to equip tax officials for effective compliance monitoring and investigation in the VDA/cryptocurrency ecosystem, if so, the details thereof and if not, the reasons therefor?The government in the Parliament replied: Several capacity-building initiatives are being undertaken by the Government to equip officers for effective compliance monitoring and investigation of VDA related transactions. Training programs, specialized workshops, Chintan Shivirs and hands-on workshops are regularly conducted by various training institutes under the Income Tax Department. At local level, field offices conduct training sessions and webinars on digital forensics, blockchain analysis, legal frameworks, and handling of digital evidence. The officers and officials are also imparted short term training on digital forensics, in partnership with National Forensic Science University (NFSU), Goa, which empower them to identify and trace VDA related transactions from data captured during intrusive to a report in The Economic Times, the Income Tax Department has sent bulk notices to taxpayers who have either not paid the correct income tax amount or failed to report income from cryptocurrency in their tax Read | Didn't report your crypto earnings? Income tax dept sending tax notices, conducting search & seizure for undisclosed income; know your options If an individual taxpayer fails to report crypto transactions, they may be liable to pay a penalty under Section 270A of the Income Tax Act, 1961. Under this section, a taxpayer is liable to pay a sum equal to fifty per cent of the amount of tax payable on under-reported income. If the under-reported income is in consequence of any misreporting of income, then it is equal to two hundred per cent of the amount of tax payable on the under-reported income.
Indian Express
6 days ago
- Business
- Indian Express
Govt collected Rs 437 crore as income tax from crypto in FY24, up 63% from FY23
The government collected Rs 437.43 crore as income tax on gains from cryptocurrencies – or Virtual Digital Assets (VDA), as they are called legally – in 2023-24, up 63 per cent from the previous year, the Finance Ministry said on Monday. In a written response to a question in the Lok Sabha on the first day of the Monsoon Session of Parliament, Minister of State for Finance Pankaj Chaudhary said that the tax collected on income from VDAs in 2022-23 was Rs 269.09 crore. This rose to 437.43 crore in 2023-24. Data for 2024-25 is not available yet as the due date for filing income tax returns for the year has not passed, Chaudhary said. While India at present does not have any law regulating crypto, the government introduced a flat 30 per cent tax on profit generated through the sale of VDAs starting April 2022, with losses made on the sale of these assets not permitted to be set-off against any other income or be carried forward. Later, starting July 2022, a 1 per cent tax deducted at source (TDS) on cryptocurrency transactions came into effect. 'The Government is utilising data analytics tools to trace and detect tax evasion from VDA related transactions. The analysis includes the use of Non-Filer Monitoring System (NMS), Project Insight and internal databases of the Income Tax Department, to correlate available information on VDA transactions with the transactions disclosed in the return of income by the taxpayer,' Chaudhary further said. He added that while VDA transactions filed in income tax returns were not being matched in real-time with information filed by Virtual Asset Service Providers (VASPs), the TDS returns of these service providers and income tax returns filed by taxpayers were being analysed to identify any discrepancies in reporting of crypto transactions. 'Central Board of Direct Taxes has initiated NUDGE (Non-Intrusive use of Data to Guide and Enable) campaign to identify such discrepancies for further action. Under NUDGE campaign suitable communications, to review and update their income tax returns, were issued to all taxpayers who did not report VDA related transactions in their income tax returns, despite tax being deducted at source for such transactions by VASPs, where the quantum of such discrepancy was more than Rs 1 lakh,' Chaudhary said. The Indian Express had reported last month, quoting sources, that the income tax department is investigating tax evasion and laundering of unaccounted income by high-risk persons through investments in VDAs, with analysis of crypto transaction data showing 'significant violations' of income tax rules. In his response in the Lok Sabha on Monday, the Minister of State for Finance said the government had not made any estimate regarding the projected revenue loss due to under-reporting or misreporting of income from VDA or crypto transactions. The information from the finance ministry on the income tax collected from crypto comes a day after CoinDCX, one of India's leading cryptocurrency exchanges, disclosed that it had suffered a loss of around $44 million, roughly Rs 379 crore, due to a security breach. Meanwhile, another leading Indian crypto firm WazirX was hit by a cyberattack last year which saw hackers allegedly steal more than $230 million of users' holdings. According to a December 2024 paper by New Delhi-based tech policy think-tank Esya Centre, analysis of relevant transaction data from December 2023 to October 2024 showed that Indians traded more than Rs 2.63 lakh crore on offshore crypto platforms, which corresponds to Rs 2,634 crore in TDS owed by offshore platforms. According to the think-tank, the total TDS that has not been collected from offshore exchanges since July 2022 possibly exceeds Rs 6,000 crore. Over the next five years, the think-tank projected, total crypto trading by Indians on offshore platforms could lead to more than Rs 17,000 crore of uncollected TDS. Siddharth Upasani is a Deputy Associate Editor with The Indian Express. He reports primarily on data and the economy, looking for trends and changes in the former which paint a picture of the latter. Before The Indian Express, he worked at Moneycontrol and financial newswire Informist (previously called Cogencis). Outside of work, sports, fantasy football, and graphic novels keep him busy. ... Read More
NDTV
7 days ago
- Business
- NDTV
Crypto Or Virtual Assets Not Regulated In India: Minister Pankaj Chaudhary
New Delhi: The question of the legality or illegality of specific crypto platforms does not arise as of date as crypto or virtual assets are not regulated in India, Minister of State for Finance Pankaj Chaudhary told Parliament on Monday. However, to ensure oversight from an anti-money laundering and countering the financing of terrorism (AML/CFT) perspective, the Financial Intelligence Unit (FIU-IND) registers Virtual Asset Service Providers (VASPs) under the Prevention of Money Laundering Act (PMLA), he said in a written reply in the Lok Sabha. "At present, crypto / virtual assets are not regulated in India. Consequently, the question of the legality or illegality of specific crypto platforms does not arise as on date," he said. The registration requirement applies equally to domestic and offshore platforms that cater to users based in India, he said. FIU-IND therefore maintains a dynamic list of virtual asset service providers who are not registered with them, he said. Separately, he said, the Finance Act, 2022, introduced Section 194S in the Income-tax Act, 1961, mandating a 1 per cent Tax Deducted at Source (TDS) on the transfer of Virtual Digital Assets (VDAs). This applies to all transactions, including those involving offshore entities, if the income is chargeable to tax in India, he said. Further, the Reserve Bank of India (RBI) has issued advisories warning users, holders, and traders of virtual currencies or crypto assets about the potential risks, including economic, financial, operational, legal, and security concerns, he said. These advisories have been sector-wide and have not commented on individual platforms, he said. Replying to another question, Chaudhary said the tax on income from transfer of Virtual Digital Assets (VDA), under section 115BBH of the Income Tax Act, 1961, was introduced from 2022-23. Amount of tax on income from VDA as per Income Tax Returns was Rs 269.09 crore in 2022-23 as compared to Rs 437.43 crore in 2023-24, he said. The government is utilising data analytics tools to trace and detect tax evasion from VDA related transactions, he said. The analysis includes the use of Non-Filer Monitoring System (NMS), Project Insight and internal databases of the Income Tax Department, to correlate available information on VDA transactions with the transactions disclosed in the return of income by the taxpayer, he added. Several capacity-building initiatives are being undertaken by the government to equip officers for effective compliance monitoring and investigation of VDA-related transactions, he said. Training programs, specialized workshops, Chintan Shivirs and hands-on workshops are regularly conducted by various training institutes under the Income Tax Department, he said. At a local level, he said, field offices conduct training sessions and webinars on digital forensics, blockchain analysis, legal frameworks, and handling of digital evidence. The officers and officials are also imparted short-term training on digital forensics, in partnership with National Forensic Science University (NFSU), Goa, which empowers them to identify and trace VDA-related transactions from data captured during intrusive actions, he added.
Time of India
7 days ago
- Business
- Time of India
Crypto or virtual assets not regulated in India: MoS Finance
Academy Empower your mind, elevate your skills The question of the legality or illegality of specific crypto platforms does not arise as of date as crypto or virtual assets are not regulated in India, Minister of State for Finance Pankaj Chaudhary told Parliament on to ensure oversight from an anti-money laundering and countering the financing of terrorism (AML/CFT) perspective, the Financial Intelligence Unit (FIU-IND) registers Virtual Asset Service Providers (VASPs) under the Prevention of Money Laundering Act (PMLA), he said in a written reply in the Lok Sabha."At present, crypto / virtual assets are not regulated in India. Consequently, the question of the legality or illegality of specific crypto platforms does not arise as on date," he registration requirement applies equally to domestic and offshore platforms that cater to users based in India, he therefore maintains a dynamic list of virtual asset service providers who are not registered with them, he he said, the Finance Act, 2022, introduced Section 194S in the Income-tax Act, 1961, mandating a 1 per cent Tax Deducted at Source (TDS) on the transfer of Virtual Digital Assets (VDAs).This applies to all transactions, including those involving offshore entities, if the income is chargeable to tax in India, he the Reserve Bank of India (RBI) has issued advisories warning users, holders, and traders of virtual currencies or crypto assets about the potential risks, including economic, financial, operational, legal, and security concerns, he advisories have been sector-wide and have not commented on individual platforms, he to another question, Chaudhary said the tax on income from transfer of Virtual Digital Assets (VDA), under section 115BBH of the Income Tax Act , 1961, was introduced from of tax on income from VDA as per Income Tax Returns was Rs 269.09 crore in 2022-23 as compared to Rs 437.43 crore in 2023-24, he government is utilising data analytics tools to trace and detect tax evasion from VDA related transactions, he analysis includes the use of Non-Filer Monitoring System (NMS), Project Insight and internal databases of the Income Tax Department, to correlate available information on VDA transactions with the transactions disclosed in the return of income by the taxpayer, he capacity-building initiatives are being undertaken by the government to equip officers for effective compliance monitoring and investigation of VDA-related transactions, he programs, specialized workshops, Chintan Shivirs and hands-on workshops are regularly conducted by various training institutes under the Income Tax Department, he a local level, he said, field offices conduct training sessions and webinars on digital forensics, blockchain analysis, legal frameworks, and handling of digital officers and officials are also imparted short-term training on digital forensics, in partnership with National Forensic Science University (NFSU), Goa, which empowers them to identify and trace VDA-related transactions from data captured during intrusive actions, he added.
