Binance recently announced its return to India on the occasion of the country’s 78th independence day — marking a fresh start to crypto adoption in one of the world’s fastest-growing digital economies. However, the exchange still faces an $86 million tax demand from Indian authorities under the Goods and Services Tax.
Binance’s return to India is the culmination of a complex regulatory process. In December 2023, the Indian Ministry of Finance’s Financial Intelligence Unit (FIU) issued notices to several offshore crypto exchanges, including Binance, KuCoin, Bittrex, Gate.io and OKX, among others, for operating illegally in India. This also led to the removal of Binance’s app from the Google Play Store and Apple’s App Store in India.
The crux of the issue was the requirement for the exchange to be registered as a “reporting entity” because reports suggest that the firm was not submitting routine statements to the Indian Income Tax Department.As a result, many users were able to circumvent the nation’s tax laws — such as the 1% tax deduction at source (TDS) levy and the flat 30% tax on all crypto transactions and digital asset transfers — and declare much lower earnings.
