Indian tax authority says crypto poses high risk of tax evasion

Indian financial authorities have highlighted the difficulty of tracking cryptocurrency transactions for tax evasion purposes, the Times of India reported. India's Central Board of Direct Taxes (CBDT) stated that offshore exchanges, private wallets, and DeFi complicate tax enforcement. The agency explained that the nature of cryptocurrency allows funds to move without passing through regulated financial institutions, limiting the ability to trace transactions. The CBDT added that identifying taxpayers is virtually impossible in transaction structures involving multiple countries. Currently, India applies a 30% tax rate on profits from crypto transactions and imposes a 1% tax deducted at source (TDS) on all trades, regardless of profit or loss.