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Online Gaming Industry Makes a Strong Pitch to Retain 18% GST on Skill Games

Online Gaming Industry Makes a Strong Pitch to Retain 18% GST on Skill Games
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  • Namita Ghosh May 13, 2022
  • 2 Minutes Read

On May 2, a Group of Ministers (GoM) met and discussed the GST levied on online gaming, horseracing, and casinos. Basis the GoM directive, a Fitment Committee comprising officers from different states is likely to meet and discuss the issue this week.

Prior to the scheduled second meeting of the Group of Meeting Though the exact date of the meeting is unclear, the Committee meeting comes as a precursor to the GoM’s second meeting, tentatively scheduled before May 18.

The Committee meeting is a significant step before the government decides whether to hike the GST charged on these sectors to a flat 28% from the existing slab of 18%. The officials will primarily recommend a valuation method for charging GST and help the GoM decide whether to suggest whether to charge the GST on the contest entry amount (CEA) or the Gross Gaming Revenue (GGR) platform fees.

A reliable source told Business Today“There was clear consensus in the meeting held by the group of ministers last week. We are waiting for the Committee to decide whether 28 percent GST will be taxed on gross or net value.”

The source added, “Following the Fitment committee’s report, the GoM is likely to meet before May 18 to deliberate on the decision. Post this; we will submit the report to GST Council.”

The GoM was constituted by the GST Council in May 2021, tasked to look into the GST rates levied on online gaming, casinos, and horseracing. The group changed members twice since and finally met for the first time early this month.

In the GoM meeting, the GoM that Meghalaya CM Conrad Sangma convened and agreed to recommend GST at a flat 28% slab from the existing 18% on skill games. The GoM also plans to recommend doing away with separate “skill” and “chance” gaming when computing the GST.

The GoM will heavily rely upon the Fitment Committee’s recommendations on the issue. Basis the Committee’s report, the GoM will finalize its recommendations to the GST Council in its upcoming meeting next week.

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