India’s Finance Ministry has accused global cryptocurrency exchange Binance of evading nearly $85 million in Goods and Services Tax (GST), part of a larger investigation into tax non-compliance by digital asset service providers. The allegations were disclosed in a response to a parliamentary question, highlighting the government’s ongoing efforts to clamp down on tax evasion in the cryptocurrency sector.

According to Finance Minister Pankaj Chaudhary, Binance’s Indian affiliate, M/s Nest Services Limited, is the largest offender among 47 Virtual Digital Asset Service Providers (VDASPs) registered for GST evasion. These providers collectively owe ₹824.14 Crore (approximately $96 million) in unpaid taxes. Binance’s share amounts to ₹722.43 Crore ($85 million), making it the primary target in this investigation. 

The government’s scrutiny follows a growing concern about unregulated crypto operations in India. The Finance Ministry’s actions have intensified, with 17 crypto exchanges currently under investigation for alleged GST violations. The focus is particularly on those offering digital assets without proper registration and compliance with the Goods and Services Tax law.

Binance’s issues with Indian regulators are not new. After operating without approval for years, the company faced a ban in India for seven months while it worked to resolve compliance issues. Binance eventually paid a $2.5 million fine and secured registration to operate in India in August 2023. In its announcement, Binance emphasized its commitment to compliance and transparent operations in the Indian market.

Despite these assurances, the alleged GST evasion paints a different picture. Binance has also faced similar challenges in other countries, including a ban in the Philippines and legal battles in the United States, where it was fined $10 billion in a settlement with the Department of Justice over money laundering concerns.

The scandal also touches WazirX, an Indian crypto platform linked to Binance. WazirX was among the companies accused of avoiding GST payments, and it recently gained attention after losing $230 million in assets to a hacking operation suspected to involve North Korean operatives. 

Binance’s troubles in India, coupled with the ongoing investigation into its operations, underscore the growing scrutiny of cryptocurrency exchanges worldwide.