Sitharaman stated that Delhi, Goa, and Sikkim have sought a review of the 28% tax on online gaming...
Digital Desk: Finance Minister Nirmala Sitharaman issued a clarification on the GST (Goods and Services Tax) on online gaming at the GST Council meeting. During the videoconference meeting, she stated that taxes are applicable on online gaming on the total amount invested to play online games, not on each bet.
She also made it clear that the tax on online casinos and gaming will be imposed at the beginning rather than on each wager.
The clarification may provide some relief to individuals who were dissatisfied with last month's decision to apply a standard 28% tax on full face value for internet gaming, casinos, and horse racing.
The GST is set to go into effect on October 1. She stated during a news conference following the 51st GST Council meeting that the same will be reviewed in six months.
The Finance Minister stated that "It (28% GST on online gaming and casinos) is expected to be implemented from October 1st... It is also decided that this decision will be reviewed six months after it is implemented. When I say six months, it does not mean starting today; it begins after it is implemented."
The gaming companies would face a 28% tax after the Group of Ministers (GoM) agreed to the proposed taxes on the stated activities at their previous meeting.
There was no agreement because Goa suggested only an 18% tax on platform fees. Sitharaman stated that Delhi, Goa, and Sikkim have sought a review of the 28% tax on online gaming.
"The council agreed today to come back after six months to review the way in which this (28 percent GST rates on casinos and online gaming) is getting implemented," the minister said.
During an earlier meeting, Sitharaman stated that the government's intention was not to end online gaming, casinos,and horse racing.
"Our intention is not to end online gaming, casinos, and horse racing. But all these have become so complex that if you go this route or that route, each route has transparency to a certain extent, but after that, it is opaque," she added.
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