Lok Sabha Question No. 13 (UNSTARRED), answered on 2025-07-21
Subject: Income Tax on VDA and Cryptocurrency Income
Ministry: FINANCE
Asked by: Shri G M Harish Balayogi, Shri Lavu Sri Krishna Devarayalu

## GOVERNMENT OF INDIA MINISTRY OF FINANCE

## DEPARTMENT OF REVENUE

## LOK SABHA UNSTARRED QUESTION NO.13

TO BE ANSWERED ON MONDAY, JULY 21, 2025/ASHADHA 30, 1947(SAKA)

## 'INCOME TAX ON VDA & CRYPTO CURRENCY INCOME'

13. Shri Lavu Sri Krishna Devarayalu :

Shri G M Harish Balayogi:

Will the Minister of FINANCE be pleased to state:

- a)  the total revenue collected from income tax on VDA/Cryptocurrency related income during the last three years, year-wise;
2. (b)  whether any estimates have been made by the Government regarding the projected  revenue  loss  due  to  under-reporting/misreporting  of  income  from VDA/cryptocurrency transactions;
3. (c)    whether  the  Government is using AI/ML/data analytics tools to identify tax evasion in VDA transactions, if so, details thereof;
4. (d)  whether a centralized system has been established by the Government for real-time  matching  of  VDA-related  ITR  filings  with  TDS  returns  filed  by  Virtual Asset Service Providers (VASPs), if so, the status of its implementation; and
5. (e) whether the Government has undertaken any capacity-building initiatives to equip  tax  officials  for  effective  compliance  monitoring  and  investigation  in  the VDA/cryptocurrency ecosystem, if so, the details thereof and if not, the reasons therefor?

## ANSWER

## THE MINISTER OF STATE IN THE MINISTRY OF FINANCE (SHRI PANKAJ CHAUDHARY)

- (a) The  tax  on  income  from  transfer  of  Virtual  Digital  Assets  (VDA),  under section 115BBH of the Income Tax Act, 1961, was introduced from FY 2022-23. The collection of tax on income from VDA, for last three years is as under:
- (b)      No such estimates have been made.

|   S. No . | Financial Year   | Amount of tax on income from VDA as per Income Tax Returns (in crore)   |
|-----------|------------------|-------------------------------------------------------------------------|
|         1 | 2022-23          | 269.09                                                                  |
|         2 | 2023-24          | 437.43                                                                  |
|         3 | 2024-25          | Data not yet available*                                                 |

(c)      The  Government  is  utilizing  data  analytics  tools  to  trace  and  detect  tax evasion from VDA related transactions. The analysis includes the use of NonFiler  Monitoring  System  (NMS),  Project  Insight  and  internal  databases  of  the Income Tax Department, to correlate available information on VDA transactions with the transactions disclosed in the return of income by the taxpayer.

(d) Real  time  matching  of  VDA  related  transactions,  filed  in  income  tax returns, with information filed by Virtual Asset Service Providers (VASPs) is not being carried out. However, TDS returns filed by VASPs and income tax returns filed  by  the  taxpayers  are  analysed  to  identify  discrepancies  in  reported  VDA transactions. Central Board of Direct Taxes has initiated NUDGE (Non-Intrusive use of Data to Guide and Enable) campaign to  identify such discrepancies for further action. Under NUDGE campaign suitable communications, to review and update their income tax returns, were issued to all taxpayers who did not report VDA related transactions in their income tax returns, despite tax being deducted at  source  for  such  transactions  by  VASPs,  where  the  quantum  of  such discrepancy was more than Rs 1 lakh.

(e) Several capacity-building initiatives are being undertaken by the Government to equip officers for effective compliance monitoring and investigation of VDA  related transactions. Training programs, specialized workshops, Chintan Shivirs and hands-on workshops are regularly conducted by various training institutes under the Income Tax Department. At local level, field offices  conduct  training  sessions  and  webinars  on  digital  forensics,  blockchain analysis,  legal  frameworks,  and  handling  of  digital  evidence.  The  officers  and officials are also imparted short term training on digital forensics, in partnership with National Forensic Science University (NFSU), Goa, which empower them to identify and trace VDA related transactions from data captured during intrusive actions.

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