The 50th meeting of the GST Council has made multiple significant revelations. The council has decided to levy 28% GST on multiple online gaming activities.
This tax will apply at the full face value, covering activities such as Horse Racing and Casino gaming. The Ministry of Finance released an official post to confirm the announcement. The development has caused a stir among online gamers and even traders.
Experts have been expecting such a development involving crypto as well. During May 2022, several reports surfaced over the web regarding the GST Council suggesting a 28% GST on crypto services.
While the ruling for the same has not been clarified yet, the GST Council has reaffirmed its stand on online gambling. The council perceives such activities as a game of chance rather than a game of skill.
The topic has been a center of attraction for the Indian Government for a while now. The GoM (Group of Ministers) previously discussed proposing taxes on these activities, but they were unable to find common ground. During that time, Goa started imposing an 18% tax on platform fees for such activities.
Parag Mehta, a partner at NA Shah Associates, shed some light on the situation. According to Mehta, the 28% GST on the full value of bets on horse racing, casino, and online gaming puts a massive dent in the gaming industry. Most of the online gaming projects will be hit in a massive way.
Similarly, Aaditya Shah, the COO of IndiaPlays, also shared his opinion on the matter. Shah stated that this announcement will restrict online gaming platforms from making new games. At the same time, it will limit the competitiveness in the market.
It is almost certain that the gaming industry will challenge these amendments legally. Most companies also look for interim relief from courts when this law comes into force.
Source: https://www.cryptonewsz.com/50th-gst-council-meet-announces-28-percent-gst-on-online-gaming/