In Surat — the hub for cryptocurrencies in India, the country’s Income Tax Department has raided real estate group Happy Home Builders, revealing undeclared bitcoins holdings worth about $47 million. In a recent survey, the Indian tax officials pointed that several major bitcoin investors in the country are real estate firms.
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The tax regulators also prepared a list of two groups, in addition to 60 individuals who have not reported BTC gains in their returns. According to reports, premises of 15 bitcoin brokers were raided on suspicion of tax evasion. If the reports are true, it would help confirm some long-held government fears that cryptocurrencies are a useful vehicle for tax dodgers.
Tax Officials Also Target Crypto Brokers
According to a local news report, the tax officers also interrogated two cryptocurrency brokers who were helping Happy Home Builders to trade bitcoins. In the past, Happy Home Builders was found to have about $3.14 million USD of “black money”– or undeclared income, under the Income Declaration Scheme launched in 2016. Tax officials have seized bitcoins worth $47 million from the group.
A senior tax official said:
“We have learned that bitcoin and other cryptocurrencies were being traded. Our objective is to find out whether such trade was aimed at evading the income tax. We are also investigating whether the capital gain tax was paid on the income generated through this trade.”
Indian Government Too Strict on Cryptocurrencies?
This was possibly the first raid by the Indian taxman in the state of Gujarat that targeted individuals who own cryptocurrencies.
In the past, the tax department has sent notices to thousands of crypto investors as transactions worth $3.5 billion were performed via various channels in the timeframe of one and half years. In December last year, tax regulators raided the country’s top nine crypto exchanges. After the raids, over 500,000 notices were issued against high net worth individuals.
According to tax officials, important documents and digital data relating to cryptocurrencies were also seized.
A source told India Today “After taking action in Ahmedabad and Bhavnagar cities, our teams are searching for evidence of unaccounted assets of bitcoin beneficiaries in Surat. In some locations, teams are examining data related to crypto-currencies.”
It is evident the Indian government is entirely opposing popular cryptocurrencies which have lured many investors over the past 12 months. The upcoming G20 summit in Argentina will presumably be a deciding ground for the fate of cryptocurrencies — at least according to lawmakers.
India is a G20 member which has adopted a stricter stance against cryptocurrency investment and use.
In the future, will the Indian Government give loosen its grip on the crypto market?