oppn parties VDAs Brought Under PMLA, Exchanges To Be Reporting Entities

News Snippets

  • Delhi chief minister Arvind Kejriwal, referring to a spate of FIRs for putting up posters in Delhi which said "Modi Hatao, Desh Bachao", said that even the British did not act in such manner
  • The 2023-24 Appropriation BIll, which allows the government to spend Rs 45 lakh crore in the fiscal, was passed by Lok Sabha in 9 minutes without any discussion
  • Sources say that Amritpal Singh fled to Haryana and may now be in Uttarakhand
  • Experts say that Rahul Gandhi's disqualification from Parliament will kick in immediately as the conviction has not been stayed
  • Tatas to invest $2bn in super app Tata Neu
  • Chief Economic Advisor V Anantha Nageswaran has said that inflation will drop as commodity and food prices have fallen
  • Government will define quality norms to ensure better 5G service
  • Stocks tumble again on Thursday after two sessions of recovery: Sensex loses 289 points to 57925 and Nifty goes down by 75 points to 17076
  • Amicus curiae and senior advocate K V Vishwanathan has told the Supreme Court that the changes made in law and three extensions given to the present director of Enforcement Directorate are illegal and will imperil the integrity of the agency
  • Supreme Court says it cannot judicially direct the government to acquire land or buildings near the court for advocates' chambers
  • ISSF Cup shooting: Indian pair of Rhythm Sangwan and Varun Tomar win silver in 10m sir rifle mixed team event
  • WPL: UP Warriorz take on Mumbai Indians in the Eliminator today. The winner will play Delhi Capitals in the finals
  • World Boxing: Four Indians - Nikhat Zareen, Nitu Ghanghas, Lovelina Borgohain and Saweety Boora - enter the frinals in their respective category
  • Bombay HC imposes costs and dismisses a petition by a housing society that sought to have a community-wise cap on residents
  • Delhi Police files 159 FIRs for defacement of public property and 49 for posters saying 'Modi Hatao Desh Bachao'
Rahul Gandhi disqualified from Parliament, Wayanad Lok Sabha seat declared vacant
oppn parties
VDAs Brought Under PMLA, Exchanges To Be Reporting Entities

By Sunil Garodia
First publised on 2023-03-09 06:24:39

About the Author

Sunil Garodia Editor-in-Chief of indiacommentary.com. Current Affairs analyst and political commentator.

In a move to bring India's crypto regulations at par with the worldwide trend, the government issued a gazette notification on Tuesday to bring virtual digital asset transactions under the Prevention of Money Laundering Act (PMLA). The Financial Action Task Force (FATF) defines a virtual asset as "a digital representation of value that can be digitally traded, transferred and used for payment or investment purposes." FATF sets international standards aimed at preventing money laundering and terrorist financing. India's latest move is in line with FATF recommendations.

Henceforth, "exchange between virtual digital assets and fiat currencies, exchange between one or more forms of virtual digital assets, transfer of virtual digital assets (VDA), safekeeping or administration of virtual digital assets or instruments enabling control over virtual digital assets and participation in and provision of financial services related to an issuer's offer and sale of a virtual digital asset" will now be covered under PMLA, as per the gazette notification.

Further, all entities or exchanges dealing in VDAs will now act as reporting entities under PMLA. This means that like banks, financial institutions including stock brokers as well as real estate and jewellery sectors and casinos, entities dealing in VDAs will now have to maintain a record of all transactions, ensure that all their customers and users, registered or one-time, are KYC compliant and report all suspicious activity to the Financial Intelligence Unit India. The government has also said that it will penalise or even shut down entities dealing in VDAs if they do not comply with the latest changes.

Given the fact that crypto affords anonymity and can be used for financial fraud, tax evasion, moving money from one country to another, terror funding activities and for a host of other illegal financial activities not possible through legal financial channels, this move on part of the government is welcome. It means that those who use crypto can no longer use it for illegal activities as they have to provide their credentials and the transactions can be reported and traced.

Although India has not made crypto legal yet, it has slapped a 30% tax on all income from dealing in VDAs and has also prescribed deduction of 1% TDS on all transaction to ensure that they do not escape the tax net. This latest move will further tighten the grip on VDA transactions to ensure that individuals or entities do not use it for illegal activities.