Binance, a major cryptocurrency exchange, has been asked to pay approximately $86 million (INR 722 crores) by the Directorate General of GST Intelligence (DGGI) in India. The DGGI, part of India's Ministry of Finance, sent a notice to Binance for not paying Goods and Services Tax (GST) on the fees it collected from Indian users.
The GST is a tax applied to the sale and consumption of goods and services across India. According to Indian law, foreign companies offering services to Indian residents must register under the GST framework and pay this tax. Binance reportedly failed to do this.
The DGGI's investigation found that Binance earned around $476 million (INR 4,000 crores) from transaction fees. These fees were deposited into an account managed by Nest Services Limited, a subsidiary of Binance based in Seychelles. The DGGI is also looking into other Binance-related companies in the Cayman Islands and Switzerland.
This is the first time the DGGI has issued such a notice to a cryptocurrency company. Previously, the agency found that some Indian crypto exchanges had evaded $8.34 million (INR 70 crores) in taxes.
In June, Binance was fined $2.25 million by India's Financial Intelligence Unit for not registering its operations. Despite these issues, Binance is considering re-entering the Indian market as a fully compliant platform. The exchange was previously banned in January but had been a popular choice for Indian investors looking to avoid high taxes on crypto profits. Binance initially entered the Indian market by acquiring the local exchange WazirX but later distanced itself due to legal issues involving WazirX.
