India has now formally brought offshore crypto platforms under the ambit of Goods and Services Tax (GST), enforcing an 18% GST on all services provided by these platforms to Indian users. This policy shift marks a major development in the country’s efforts to regulate the growing digital asset ecosystem.
From July 7, 2025, offshore crypto exchanges offering services to Indian users are mandatorily required to register under GST and collect 18% GST on all applicable service charges. This includes fees on:
This tax policy is not arbitrary. It is backed by several legal provisions:
| Provision | Details |
| IGST Act, Section 14 | GST applies to Online Information Database Access and Retrieval (OIDAR) services offered by foreign entities. |
| CGST Notification No. 10/2017 | Mandates offshore service providers to collect and pay GST on digital services. |
| GST Circular No. 163/19/2021-GST | Clarifies that crypto exchanges fall under OIDAR when offering services digitally to India. |
This means foreign exchanges such as Binance, Bybit, Kucoin, OKX offering digital services like trading platforms, wallets, or APIs must now collect GST from Indian users or face enforcement actions.
The 18% GST is over and above the existing taxes on crypto trades in India. Here’s a breakdown of the current tax burden:
| Tax Type | Rate | Applies On | Paid By | Relevant Law |
| GST | 18% | Platform fees | Exchange (OIDAR) | IGST Act Sec. 14 |
| TDS | 1% | Total sell transaction | Buyer | Sec. 194S, Income Tax Act |
| Income Tax | 30% | Net gains from crypto | Seller | Sec. 115BBH, Income Tax Act |
For retail investors, this creates a "triple tax trap", increased trading costs, reduced profits, and heightened compliance responsibilities.
GST applies only to services, not the purchase value of crypto. Here’s a quick guide:
Read Next: Crypto Tax in India
For most retail users, GST paid is a sunk cost. Only GST-registered businesses that use crypto for business purposes may attempt to claim input tax credit (ITC). Even then, it’s a legal grey area and could attract scrutiny.
Indian users of offshore crypto exchanges should immediately:
As offshore platforms begin charging 18% GST, Indian investors are experiencing the triple burden of tax. We believe this highlights the urgent need for a balanced, innovation-friendly regulatory approach that supports India’s growing digital economy.
