Bybit Imposes 18% GST on Indian Crypto Users

Bybit, a leading cryptocurrency exchange, has announced the implementation of an 18% Goods and Services Tax (GST) on all trading and service fees for its Indian users, effective from July 7, 2025. This decision is in response to India's regulatory requirements, which mandate the application of GST on cryptocurrency transactions. The new tax policy will impact a wide range of Bybit's offerings in India, including derivatives, spot trading, and margin trading. The tax will be calculated based on the fees and orders placed by users, ensuring compliance with local tax laws.

The implementation of the 18% GST is expected to increase the tax burden on Indian crypto users, who will now have to pay an additional tax on top of the existing 30% tax on profits and 1% Tax Deducted at Source (TDS) per transaction. This move by Bybit reflects the evolving regulatory landscape for cryptocurrencies in India, where the government has been taking steps to bring digital assets under the purview of existing tax laws. The new tax policy is likely to impact the profitability of crypto traders in India, who will now have to factor in the additional cost while making trading decisions.

The decision by Bybit to implement the 18% GST on Indian users is a significant development in the Indian crypto market, which has been growing rapidly in recent years. The move is expected to have a ripple effect on other crypto exchanges operating in India, which may also be required to comply with the GST regulations. The implementation of the GST on cryptocurrency transactions is a step towards bringing the digital asset market under the ambit of the formal economy, which is likely to enhance transparency and accountability in the sector. However, it remains to be seen how the increased tax burden will impact the trading volumes and user base of Bybit in India.

Bybit's announcement has sparked discussions within the crypto community, with some users considering decentralized exchanges as an alternative to avoid the additional tax burden. The move could potentially reconfigure trading volumes and workshops, impacting liquidity and exchange participation. Historically, shifts in India's crypto tax policy, such as the introduction of income and TDS taxes, have led to notable migrations to offshore platforms. Projected outcomes include reduced centralized exchange (CEX) liquidity, increased decentralized exchange (DEX) activities, and strategic tax avoidance maneuvers by Indian traders.

Bybit's GST move, without parallel in other G20 markets, distinguishes India for its unprecedented tax environment. The financial strain may reroute trade flows, forcing users to adapt or face increased transaction expenses. Reports suggest increased DEX usage as Indian traders grapple with regulatory implications. The new GST charge signifies India's intensifying crypto tax environment and potential shifts in trading behavior among Indian users. Bybit has announced an 18% GST for Indian users, based on India's taxation regulations. The tax applies to all transactions, including spot and derivative trading. The decision aligns with India's stringent crypto tax policies which include a 30% income tax and a 1% TDS on crypto profits. Affected users are encouraged to consider decentralized exchanges as an alternative, sparking discussions within community channels.