Binance Entity Faces $85 Million Tax Evasion Probe in India

• Binance-linked Nest Services evaded ₹722.43 crore, leading India’s GST violations list.
• Indian authorities recovered ₹122.29 crore from crypto firms, excluding Binance-linked evasion.
• 17 crypto platforms investigated for tax evasion; Binance entities contributed 88% of total.

The Indian Finance Ministry says some cryptocurrency exchanges in the country are dodging taxes. Nest Services Ltd, reportedly linked to the Binance Group, is the biggest offender, sources say.

The company did not pay ₹722.43 crore (around $85 million) in Goods and Services Tax (GST). This shows the scrutiny of cryptocurrency platforms in India because of concerns over tax compliance.

Binance Group Is the Biggest Tax Evader

The Indian government is making sure cryptocurrency exchanges follow tax laws. According to recent disclosures, Binance-related entities topped the list of tax evaders, contributing significantly to a total GST evasion of ₹824.14 crore ($96 million). Nest Services Ltd, based in Seychelles, accounted for nearly 88% of this amount.

This comes after the Directorate General of GST Intelligence (DGGI) in Ahmedabad issued a notice to the company in August. Investigations showed that transaction fees from Binance’s operations were going to accounts that were managed by Nest Services. But no recoveries have been made from Nest Services.

WazirX and Other Exchanges

While Binance-linked firms dominate the tax evasion chart, other exchanges like WazirX have also faced penalties.

WazirX, operated by Zanmai Labs Pvt. Ltd., evaded ₹40.51 crore ($5 million) in GST. The platform has faced additional challenges, including a hack in July resulting in a loss of $235 million worth of funds.

Read also: Binance Aided Investigative Action That Led to Arrest of ISIS Members

The Indian Finance Ministry confirmed that 47 Virtual Digital Asset Service Providers are registered under the Financial Intelligence Unit, with 17 of them investigated for GST violations. A total recovery of ₹122.29 crore ($14.2 million), including interest and penalties, has been achieved from these entities.

Government’s Measures to Curb Evasion

To curb tax evasion, foreign entities providing services in India must comply with GST requirements and register under the framework. Consequently, Binance has taken steps to address its compliance issues, including registering with the Financial Intelligence Unit and paying a $2.25 million fine. Moreover, Binance has appointed a representative to coordinate with Indian authorities and assist in cracking down on fraudulent activities.

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