28 Percent Tax Will Have To Be Paid For Playing Online Games, Government’s Plan In Making
New Delhi, 3rd May 2022: The Finance Ministers’ panel has agreed to increase the GST rate on online gaming, casino and horse racing to 28 percent. However, a decision on whether the tax should be levied on gross or net assessment will be taken at a later stage.
Bengal Finance Minister Chandrima Bhattacharya said the Group of Ministers (GoM) will decide the correct assessment of tax on services.
At present, online gaming, casino and horse racing services attract 18 per cent GST. In May last year, the government had constituted a panel of state ministers to assess the correct GST on services such as online gaming, casinos and horse racing.
The Group of Ministers, chaired by Meghalaya Chief Minister Conrad Sangma, met on Monday and discussed the GST rate applicable on these three services. There was a clear consensus among the ministers that the highest rate of 28 per cent should be imposed on all three services – online gaming, casino and horse racing.
Bhattacharya said, “A committee of officers will report within 10 days whether the tax should be levied on gross or net assessment. After this there will be another meeting of the GoM and a final decision will be taken in it.”
He said that the decision of the GoM would be taken keeping in mind these services, society and other stakeholders. The report of the GoM is likely to be considered in the meeting of the GST Council to be held later this month.
The eight-member panel includes Maharashtra Deputy Chief Minister Ajit Pawar, Gujarat Finance Minister Kanubhai Patel, Goa Panchayati Raj Minister Mauvin Godinho, Tamil Nadu Finance Minister P Thiagarajan, Uttar Pradesh Finance Minister Suresh Khanna and Telangana Finance Minister T Harish.
AMRG & Associates Senior Partner Rajat Mohan said there has been a long period of litigation and harassment surrounding the valuation of the services of online gaming, casino and horse racing. He said that it is hoped that whatever rules will be framed, the issues raised by the tax authorities will be resolved and the sector will get a chance to flourish.
