CBIC Prepares to Implement 28% GST on Online Gaming, Casinos, and Horse Racing
New Delhi, 29th September 2023: CBIC Chairman Sanjay Aggarwal announced that the Central Board of Indirect Taxes and Customs (CBIC) is set to implement the GST Council’s decision to levy a 28% tax on online gaming, casinos, and horse racing.
State Consensus Required for New Tax Law
Following the recent passage of amendments to the GST laws in the Lok Sabha, the CBIC Chief emphasized that the next step is to secure the approval of all state Legislative Assemblies. An ordinance must be issued by September 30 to enact the new tax rate.
Scope of the 28% GST
The increased GST rate will apply to bets placed in online gaming, the face value of chips purchased in casinos, and wagers made with bookmakers or totalizers in horse racing.
Previous Tax Rate and Industry Reaction
Notices have already been sent to many online gaming companies, instructing them to comply with the new 28% GST rate, up from the current 18%. The Lok Sabha passed these amendments, part of the Integrated Goods and Services Tax (Amendment) Bill, 2023, and the Central Goods and Services Tax (Amendment) Bill, 2023, on August 11 by voice vote.
The decision to impose the 28% GST was initially made during the 51st meeting of the GST Council on August 2. The online gaming industry had strongly protested the decision, urging the government to reconsider.
Government Stands Firm
Despite industry pushback, the government reaffirmed its stance, announcing that the 28% GST rate will take effect starting October 1.
