Bitcoin May have Headway as the Income-Tax Department of India is willing to Listen

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Bitcoin May have Headway as the Income-Tax Department of India is willing to Listen
Bitcoin May have Headway as the Income-Tax Department of India is willing to Listen

Bitcoin May have Headway as the Income-Tax Department of India is willing to Listen

After the strict guidelines issued by the RBI that Bitcoin is unsafe and a risky instrument for financial exchange, the Enforcement Directorate or ED raided India’s biggest Bitcoin trading platform and it looked over for Bitcoin. However, the latest reports coming from Bangalore show that Bitcoin may get good news soon.

According to Satvik V, Founder, Coin Monk, Tumkur-based Coin Monk Ventures, a Bitcoin mining start-up that creates the digital currency, a team of close to 15 tax officials visited his place and inquired with the people. He says that the officials took interviews of the employees and were happy that Coin Monk was a properly registered company.

Satvik V also said that much of the discussion that took place was over how Bitcoin actually works and how income tax can be levied on miners and exchanges. This is similar to what the Fed did the last year with the U.S. Bitcoin companies when it summoned them for inquiry. Thus, it should be taken into positive direction.

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The Move may go to the Right Direction

It clearly looks that Income-Tax Department is interested to expand its outreach to Bitcoin companies. Mr. Satvik also said that after the visit, they issued a summons for him to meet them at their Bangalore office and asked him to submit a technical paper on how Bitcoin works, and, more importantly, what role a Government authorized exchange could play.

It looks the I-T department is in first phase as it itself does not know about the digital currency and currently seems interested only in collecting a database on how many digital currency users there are in India. The government agency is also trying to know about the Bitcoin users in India and whether they can all be tracked or not.

This has to be remembered that Bitcoin community is in shock after the Reserve Bank of India (RBI) issued an advisory that warned the public that using digital currencies like Bitcoin which are not just risky but not money in true sense should be avoided. Now that the Income-Tax Department is willing to listen to the people in Bitcoin community, headway is expected.

Though the Income-Tax Department is looking for possible instances of tax evasion, if something positive goes and thinks for imposing income tax on Bitcoiners, it will be a positive move towards the right direction as it will open the gates for legalization and legitimization of Bitcoin in India.

To contact the reporter of this story: Jonathan Millet at john@forexminute.com