The Indian government stands firm on Goods and Services Tax (GST) issues related to the gaming industry.
According to reports, India’s top Finance Ministry sources confirm that the government is unlikely to relieve the GST on the gaming industry, which has become a significant setback.
In a recent Supreme Court hearing, Additional Solicitor General Venkatraman dismissed reports of a rift between senior government officials and the legal team regarding the pursuit of retrospective GST notices against online gaming companies.
According to the law, gaming companies are obligated to pay 28% GST on each bet placed. However, industry participants want to pay only 18% of the gross gaming revenue (GGR) or the platform fee.
Although the government introduced a new tax regime, imposing a 28% tax on deposits effective from October 1, 2023, the tax department considers this change as clarificatory. According to their perspective, the 28% tax on the full value of the wager amount has been applicable since July 2017.
The Bombay High Court, the Goa bench of the Bombay High Court, the Karnataka High Court, the Calcutta High Court, and the Sikkim High Court are currently adjudicating cases related to GST notices issued to online gaming companies and casinos. Additionally, two cases are awaiting resolution before the apex court.
