India crypto tax filings lag trading activity: Report

India’s tax department reportedly found that fewer than a quarter of the 645,000 people who made crypto transactions reported them on tax returns.

India’s tax department reportedly found widespread gaps in crypto tax reporting, warning that offshore exchanges, private wallets and peer-to-peer (P2P) trades are making crypto activity harder to track.

Reuters on Wednesday reported government documents showed that fewer than a quarter of 645,000 individuals who made crypto transactions in the year ending in March 2023 reported the trades on their tax returns. The department also reportedly estimated that India had about 39 million crypto traders holding over $2.1 billion in crypto at the end of May.

The findings add a tax-enforcement factor to the country’s long-running digital asset policy debate, moving the issue beyond the central bank’s financial-stability concerns and into questions on offshore trading and recoverable tax revenue. India was ranked first in Chainalysis’ 2025 Global Crypto Adoption Index.