India's tax authorities have dropped a bombshell on Binance. The crypto giant faces a whopping $86 million bill for unpaid taxes.
The Directorate General of Goods and Service Tax Intelligence (DGGI) is behind this massive demand. It's targeting Binance under the Goods and Services Tax (GST) framework.
Binance isn't alone in this mess. Other offshore crypto exchanges are in the crosshairs too. They were all banned in India earlier this year for not playing by the rules.
But here's the kicker: Binance wants back in. In April, they said they'd pay up to restart operations in India.
A local source spilled the beans to The Times of India. They said, "Binance reportedly earned at least Rs 4,000 crore from transaction fees charged to Indian customers. Detailed investigation revealed that the earnings of these fees were credited to the account of a Binance Group Company — Nest Services Limited — based in Seychelles."
This tax demand is a first for India. No crypto exchange has faced such a bill before.
Indian authorities tried to reach Binance via email. They sent notices to offices in Seychelles, the Cayman Islands, and Switzerland. Binance ghosted them at first but later hired a local lawyer to sort things out.
India's crypto tax rules are no joke. There's a 1% tax on every transaction and a 30% tax on profits. Local exchanges like WazirX and CoinDCX play ball, but offshore platforms have been slacking.
Binance thought they could get away with a $2 million fine. Boy, were they wrong. The $86 million demand aims to recoup fees from Indian users.
India's not messing around. They're using these taxes to prevent money laundering. Other foreign exchanges like Huobi, Kraken, and KuCoin might be next in line for similar treatment.
This isn't Binance's only tax headache. They're fighting similar battles in other countries, including Nigeria.
It's a tough spot for Binance. Pay up or stay locked out of one of the world's biggest markets. The crypto world is watching to see what happens next.