Group of Indian Ministers (GoM) to recommend GST for Online Gaming
Online gaming
Online gaming saw a surge during the time of the Covid lockdown in India, with the number of users rising substantially. According to a KPMG report, the online gaming sector in India, would grow to Rs 29,000 crore by 2024-25 from Rs 13,600 crore reported in 2021.
According to local reports, online gaming in India, currently attracts 18% GST (Goods on Services Tax). The said tax is levied on gross gaming revenue, which is the fees charged by online gaming portals.
Group of Ministers
It was reported that a Group of Ministers (GoM) comprising of 8 members, that was tasked by the Goods and Services Tax Council, to appraise tax for gaming in India, may recommend raising the GST on online gaming, from 18% to 28%.
Also, according to Conrad Sangma, the Meghalaya chief minister; the GoM would soon submit its concluded report to the GST Council, which is the apex decision-making body for GST –related matters, for consideration.
It was further reported that as there was no consensus during deliberation, on whether the tax should be levied on only the fees charged by the portal, or the entire consideration, which includes the bet funds received from players; the GoM has made the decision to refer all their suggestions to the GST Council, for a final decision on the issue.
The GoM Recommendation
According to local news, the GoM had earlier on, submitted a report to the council on this matter in June, in which they suggested the 28% GST raise, on the full value of the consideration, which included the contest entry fee paid by the player; without making a distinction on whether it is for a game of skill or chance.
Experts however, opined that the suggested 28% increase, on the entire amount deposited by players, would reduce the prize money left for distribution, and is likely to drive away players from legitimate tax deducting portals. It is likely to also encourage online gamers, to use illegal portals that do not deduct such tax.
The Council, after receiving the June submission, asked the GoM to reconsider its report.
The GoM is now set to resubmit a review of its earlier report to the Council. However, sources told the Indian Express that the GoM, after deliberating on separate definitions for ‘games of skill’ and ‘games of chance for this new report, finally decided to tax both as demerit goods, which will attract a 28% GST.
GoM Members
The 8-member GoM, for the tax appraisal includes Thiaga Rajan, Maharashtra Deputy Chief Minister Devendra Fadnavis, Finance Ministers of West Bengal (Chandrima Bhattacharya), Gujarat (Kanubhai Desai), Uttar Pradesh (Suresh Kumar Khanna), Telangana (T Harish Rao), and Goa Industries Minister Mauvin Godinho.
Source: yokonet.com
Thank you for your sharing. I am worried that I lack creative ideas. It is your article that makes me full of hope. Thank you. But, I have a question, can you help me?