The Union Finance Minister Nirmala Sitaraman presided over the 50th meeting of the GST Council today (11th July 2023) at Vigyan Bhawan in New Delhi including Revenue Secretary, CBIC chairman.
Also read : 50th GST Council Meeting: Finance Minister releases Special cover and Customised mystamp
The GST Council has approved a 28% tax on online gaming on the whole face value amount.The new GST rate will be 5%, down from the previous 18%.
The Council has decided that online gaming, casinos and horse racing will be taxed at 28 per cent at entry point on full face value of bets.
The GST statute would be amended to clarify that these three supplies are not actionable claims, in contrast to lotteries and wagering.
The amended Finance Act of 2023 and IT Intermediary Amendment Rules have given the online gaming industry confidence that the government will stick with an 18% GST, as opposed to 28% on gross gaming revenue.
The council has agreed to eliminate the distinction between games of skill and games of chance when it comes to online gaming and a tax of 28% will be applied to the total face value of bets.
This change is crucial as applying a higher GST on GGR could result in a significant rise in tax, with an impact as high as 1100% on businesses and 300% on gamers. Additionally, income tax on gamers has been separately notified in the Finance Act 2023, with a TDS of 30% to be deducted from “net winnings” in the user account at the end of the financial year.
Read more : GST Council to Meet Next Month: Cement Tax and Online Gaming on Agenda
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