TLDR
Bybit to impose 18% GST on Indian users’ trading fees starting July 7.
GST applies to spot, margin, derivatives, loans, and fiat transactions.
Bybit suspends crypto loans, cards, and bots for Indian users.
India’s tax regime now includes 30% profit tax, 1% TDS, and 18% GST.
Bybit crypto exchange has announced an 18% Goods and Services Tax (GST) on trading-related fees for its Indian users. This move comes as part of the company’s compliance with India’s complex crypto tax framework, which already places a heavy burden on both retail and institutional traders.
The 18% GST will be charged on various services across the platform, beginning July 7. The change affects users involved in spot trading, margin trading, derivatives, and several other services. Bybit will collect the GST and remit it to the Central Board of Indirect Taxes.
GST Charges Extended Across Multiple Bybit Services
According to Bybit’s announcement, Indian users will now pay GST on fees collected through a wide range of transactions. This includes all spot and margin trading activities, derivatives trades, and unified trading account (UTA) transactions.
Users will also be charged GST on fiat deposits, withdrawals, crypto purchases using bank cards, and small-balance conversions to MNT OTC trading. The company noted, “In accordance with Indian tax regulations, GST applies to the service component of transactions. For crypto trades, this includes the spread – the difference between the buy and the sell price – which is considered a part of the service provided by the platform.”
Moreover, GST will apply to earnings from crypto loans, margin staked SOL, and other products like Bybit Earn and Bybit Pay. These adjustments align with India’s requirement that exchanges charge GST on service fees, including trading spreads and associated operations.
Changes to Bybit Offerings for Indian Users
Bybit has also confirmed that it will suspend some services for Indian users due to the country’s regulatory landscape. Legacy crypto loan products, Bybit cards, and a series of trading bots will no longer be available to users in India.
At the same time, other platforms are adjusting their services in response to India’s tax rules. Bitget, for example, has introduced a new crypto card in partnership with Mastercard and Immersve. The card operates with no fees, aiming to attract Indian users looking for alternatives.
Bybit’s decision reflects broader changes in how international exchanges operate within India. While it allows the company to meet compliance requirements, it may also shift the behavior of users looking to manage their tax exposure.
India’s Crypto Traders Face Complex Tax Structure
India’s cryptocurrency tax system is widely seen as complex and burdensome by participants in the sector. Traders must pay a 30% tax on profits, a 1% Tax Deducted at Source (TDS) on every transaction, and now face an 18% GST on service charges.
This tax framework has prompted some users to look for alternatives. Many have shifted to foreign exchanges that do not enforce GST or TDS. Others are using peer-to-peer (P2P) platforms to avoid centralized exchanges altogether.
A growing number of traders are also reducing trading frequency to avoid the 1% TDS on each trade. These adjustments highlight how users are trying to work around the multiple tax layers imposed by regulators.
Global Trends in Crypto Taxation and India’s Position
Globally, some jurisdictions are revising their tax approaches to support digital asset adoption. In the United States, a new bill introduced by Senator Cynthia Lummis proposes eliminating taxes on Bitcoin transactions under $300. The bill also seeks to prevent miners from paying tax twice on the same earnings.
Meanwhile, India is reportedly reviewing its crypto tax policies. Industry observers have suggested that the government may revise its regulations to align more closely with global standards. However, no formal changes have been made so far.
Bybit’s GST move signals compliance, but it raises further questions about the sustainability of crypto participation in India under the current tax structure.
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