18% GST Now on Crypto Fees in India

Goods and services tax (GST) will be assessed at 18% on all fees for trading and service provision that are associated with crypto trading, effective from July 7, 2025. These developments have been significant for all traders, particularly in India and raise uncertainty in the sustainability of some or more digital assets.

The move makes Bybit one of the latest international exchanges to adjust operations in line with India’s regulatory framework. As part of the change, GST on crypto services will be levied across a wide range of offerings, including spot and margin trading, derivatives, fiat transactions, and withdrawals.

What’s Changing?

According to Bybit’s official announcement, Indian users will now see 18% GST applied to service fees and trading fees, with the tax deducted directly from their transaction proceeds. For instance, if a user sells 1 BTC for 100,000 USDT, the net amount they receive will be around 99,882 USDT after accounting for trading fees. This may seem minor, but for cumulative traders, it can eat into profits.

Unified Trading Accounts are also impacted. GST will now apply to auto-repayments, liquidations, and conversions. Native staking services under Bybit’s On-Chain Earn will see GST applied to service fees deducted from interest payouts, though promotional APR boost rewards will remain untouched.

Another key factor will be withdrawals. The cost calculations will include GST, and the Initial Margin and Maintenance Fees will be adjusted to account for the higher charges. It will apply to:

Recovering mistakenly deposited assets
OTC (Over-the-Counter) trading
Bybit Pay transfers between users and merchants
A Heavy Tax Burden for Indian Crypto Users

This tax implementation is part of an increasingly heavy-handed approach to crypto regulation in India. Traders are already required to pay a 30% tax on crypto profits and a 1% Tax Deducted at Source (TDS) on every transaction. With the addition of an 18% GST on service fees, Indian traders are now facing a three-pronged tax regime that makes frequent trading less appealing.

These tax changes may also initiate discussions amongst Indian crypto investors to consider different trading platforms or trading strategies. Some may revert to peer-to-peer or decentralised platforms to mitigate their costs, but beware that they will have their challenges and risks around compliance.

Bybit Discontinues Several Services in India

In addition to the GST rollout, Bybit is pulling back several services in India. Starting July 9, legacy crypto loans, the Bybit card, and several automated trading bots, including Spot Grid, DCA, and Futures Combo, will no longer be supported. Transactions with Bybit-issued cards will be blocked from July 17, and outstanding loans will be automatically repaid.

While the company frames these moves as part of a broader compliance strategy, critics argue that these measures, combined with the escalating tax burden, may stifle innovation and adoption in India’s digital asset space.

What Indian Traders Should Do

With the recent developments on Bybit, Indian traders and investors need to rethink their trading practices, strategies, activities, and tax responsibilities. Anyone receiving crypto services should be paying their relevant GST. Businesses dealing within the crypto space that haven’t done GST registration would qualify for an easier compliance regime, as there are no stringent audits or regulatory issues later on.

Traders should be ready to pay penalties and lose their good reputation with tax-shaming institutions if they breach deadlines for accurate GST return filing. As India regularly updates its regulations on all things crypto, staying compliant is crucial.

The Indian government is increasing oversight on the digital assets with an over 18% tax. This marks a significant shift for cryptocurrency users. With the introduction of GST on Crypto, traders must now rethink strategies and compliance efforts. Adapting quickly may be the only way forward in India’s crypto landscape.