India Tax Authority Backs RBI Warnings on Crypto Enforcement Challenges
India’s tax authority has publicly highlighted enforcement challenges tied to virtual digital assets in the run-up to the Union Budget, reinforcing earlier warnings from the Reserve Bank of India. Officials pointed to gaps in tracking transactions and collecting tax on crypto activity, signaling coordination between fiscal and monetary policymakers on the need for stronger controls. The tone was cautious to negative, reflecting concern about market opacity and revenue risks.
The joint emphasis from tax and central bank authorities raises the odds of stricter reporting requirements, enhanced KYC/AML scrutiny, and clearer guidance for exchanges and over-the-counter desks when the Budget is presented. For investors and firms, that could mean higher compliance costs and closer scrutiny of transaction flows; for policymakers it creates momentum to close enforcement loopholes. Market participants should watch budget announcements and follow-up regulatory filings for specific measures and timelines.