Govt “fully prepared” to levy 28% GST on online gaming from Oct 1: CBIC Chairman
September 29, 2023
The government is “fully prepared” to levy 28% goods and services tax (GST) on online gaming, casinos, and horse racing from October 1, said Sanjay Kumar Agarwal, chairman, Central Board of Indirect Taxes (CBIC) on Thursday.
“As per the decision taken in the last (51st) meeting of the GST Council, the related notifications are under process,” Agarwal said at the sidelines of an event organised by the FICCI.
The statement comes amid a stand-off between the gaming industry and the GST authorities, and rising number of court cases.
On the possibility of deferment of the notification by the Centre, the CBIC Chairman said that in the 51st GST Council meeting, it was decided to review the implementation (of 28% levy) after six months and difficulties will be seen at that time.
Agarwal also said that the show-cause notices being issued to gaming companies on tax shortfalls, are being sent as per legal provision.
Tax authorities have sent notices to several online gaming companies in the past few weeks. On Tuesday, Dream Sports, the parent company of Dream 11 filed a writ petition in the Bombay High Court challenging a GST notice which alleged the evasion of reportedly Rs 25,000 crore. Last week, Delta Crop was also served a tax notice amounting to Rs 1,140 crore on similar grounds.
Earlier this month, the Supreme Court had stayed Karnataka High Court’s ruling, which quashed a GST notice against online gaming company Gameskraft for alleged tax evasion to the tune of Rs 21,000 crore.
In the monsoon session, the parliament had passed The Central Goods and Services Tax (Amendment) Bill, 2023 and The Integrated Goods and Services Tax (Amendment) Bill, 2023 to levy the 28% tax.
To implement the GST rate, the states will now have to pass the required legislation in the respective state assemblies or bring out an ordinance, Agarwal said.
Meanwhile, in his speech, CBIC’s Chairman said that the recent decisions taken in successive GST Council meetings has helped curb the menace of fake input tax credit (ITC) claims. “An environment is being created so that the fraudsters are not allowed to enter the ecosystem and pollute it,” he said.
[The Financial Express]
