India’s Parliamentary Standing Committee on Finance will meet Binance, WazirX, and ZebPay on May 20 to discuss the future of the country’s crypto rules. The panel will focus on how India should treat “Virtual Digital Assets” (VDAs), as trading, offshore platforms, and tax enforcement continue to grow. Lawmakers plan to ask how major exchanges handle compliance, user protection, and cross-border flows, especially as India tightens reporting requirements under its Union Budget 2026.
The committee has called the senior officials of the three exchanges to testify before it in New Delhi, local sources say. Also expected to attend are officials from the finance ministry and major regulators, giving the conference a more wide-policy-roundtable feel than a one‑off briefing. The session comes after months of pressure from industry and police agencies for clearer standards
Tough Tax and Reporting Regime in the Background
The talks will take place against the backdrop of India’s strict VDA tax regime and new reporting rules. Since 2022, India has taxed crypto gains at 30 percent and applied a 1 percent tax deducted at source on most trades, measures that pushed much of the volume offshore. In the 2026 Union Budget, the government added penalties to Section 509 reporting rules, which force exchanges and other “reporting entities” to file detailed statements of users’ crypto transactions with the tax department.
Platforms now face daily fines for failing to file data and lump‑sum penalties for inaccurate reports, so they must upgrade systems to track flows. ZebPay’s COO Raj Karkara said those measures bring digital asset reporting closer to traditional finance standards, while WazirX founder Nischal Shetty warned they still hurt liquidity and India’s competitiveness. The parliamentary panel is expected to hear how these rules affect order books, market depth, and the incentive to trade on unregulated offshore venues.
Each invited exchange has its own history with the Indian regulators. The Enforcement Directorate is investigating WazirX, formerly owned by Binance, for possible foreign‑exchange violations and money laundering related to Chinese betting applications, although the exchange says it follows the law and is cooperating with investigators. ZebPay, one of India’s oldest exchanges, has been an outspoken advocate for clearer standards and recently said beefed-up compliance is a way to establish trust.
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