CBDT Issues Crypto Reporting Rules, Parliamentary Panel Pushes for Comprehensive Law
The Central Board of Direct Taxes (CBDT) has issued a detailed guidance note clarifying how cryptocurrency exchanges and other virtual digital asset (VDA) service providers must comply with reporting obligations under the Income Tax Act. The move operationalises the OECD's Crypto-Asset Reporting Framework (CARF), an international standard aimed at improving tax transparency by enabling authorities to track crypto transactions.
The guidance comes days after the Parliamentary Standing Committee on Finance urged the government to examine the need for a comprehensive statutory and regulatory framework for virtual digital assets. Together, the developments indicate that India is gradually moving towards a more structured approach to overseeing the crypto industry.
The CBDT guidance does not introduce new taxes or regulate crypto assets directly. It focuses on standardising reporting procedures to align with global norms. Industry players have described the guidance as an important milestone. Edul Patel, CEO of Mudrex, said it is "a significant step towards building a more transparent and credible digital asset ecosystem in India." Vimal Sagar Tiwari, Co-Founder of CoinSwitch, noted that the operationalisation of CARF provides "much-needed operational clarity" and strengthens the integrity of the ecosystem by making it harder to underreport taxable transactions.
While the guidance is limited to tax reporting, industry leaders believe it lays the groundwork for a broader policy framework. Patel stated that stronger reporting standards will equip policymakers to design balanced regulations that protect investors while encouraging innovation. The industry has long advocated for regulatory clarity, and this marks another step towards a comprehensive framework.
