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  • The Central Economic Intelligence Bureau (CEIB) has proposed a new tax on Bitcoin.
  • Under the new law, Bitcoin would be categorized as an intangible asset.

According to The Central Economic Intelligence Bureau (CEIB), Bitcoins could be categorized under the intangible assets class and a Goods & Services Tax (GST) levy could be imposed on all transactions. 

Now, the central government is weighing the potential of imposing an 18% GST levy on Bitcoin transactions that apparently would generate Rs 7,200 crore annually. 

This proposal is not necessarily new as back in May 2018, the government was already talking about a potential tax on cryptocurrency transactions. blockchain lawyer Varun Sethi said on Tuesday:

All trades ideally shouldn’t have 18% GST attraction, noting that 18% should ideally be for service-based income. Does that mean bitcoin can be deemed to be taken as exchange for services. For daily traders, ideally should be treated as commodity trading & attract capital gains.