Impasse on GST levy for cryptocurrency & virtual digital assets still continues...!! In the last GST Council meeting held in October, the task was handed over to the Tax Research Unit under CBIC, and the council had asked them to prepare a report.

However, sources indicate that "this report is yet to be finalised, as deliberations are still underway, and the tax research unit is currently examining whether to treat cryptocurrency/virtual digital assets as financial instruments, goods, or services."

This is the second time that tax authorities are finding it difficult to finalise a proposal for the GST Council.

Currently, the industry is paying an 18% GST on the platform fee for providing the service to customers to transact, and no GST is charged on the value of the cryptocurrency/virtual digital asset/tokens.

The council had asked tax officers to assess whether cryptocurrency or virtual digital assets are actionable claims and should attract 28% GST, in addition to 18% GST on transaction fees.