Traders paying goods and services tax (GST) on a quarterly basis under a concessional flat rate scheme and investors in cryptocurrencies are suspected of tax evasion, finance ministry officials said on Tuesday.
Finance secretary Hasmukh Adhia said at an industry meet that of the one million businesses that signed up for the GST composition scheme during the July-September period, about seven lakh filed GST returns for the quarter. Of the seven lakh assessees, five lakh filed returns for the quarter showing annual turnover of less than Rs5 lakh.
“Now we are wondering why did they register then? Up to Rs2 million (annual turnover) there is no need to register in GST,” Adhia said.
At a separate event, Central Board of Direct Taxes (CBDT) chairman Sushil Chandra said nearly 10 million notices have been sent to people who have invested in cryptocurrencies like bitcoin and have not declared it in their income tax returns.
“People who have made investments (in cryptocurrency) and have not declared income while filing taxes and have not paid tax on the profit earned by investing, we are sending them notices as we feel that it is all taxable,” Chandra was quoted as saying in a statement issued by industry lobby Associated Chambers of Commerce & Industry of India (Assocham).
Chandra said surveys have been done on cryptocurrency exchanges to find out how many people were regular contributors, how many had registered themselves and how many traded on these platforms.
He said that the department had found that there was no clarity on investments made by many people, which implied they had not declared them.“As per income tax laws, whatever money one is investing (in cryptocurrency), it would be taxable if it is unexplained. Besides, even the profit gained on the same is taxable,” he said.