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GST Council to Meet About Tax on Online Gambling
By: Tupaki Desk | 25 Oct 2022 5:02 AM GMT
The Goods and Services Tax Council had a meeting scheduled for August this year but was delayed because the GoM's (Group of Ministers') report for GST levying on casinos, horse racing, and online gaming hasn't decided whether to group these games as games of chance or games of skill for a clear taxing logic to be set.
According to an official, the GST council might meet by mid-November to discuss the panel of ministers' report on creating a GST appellate tribunal and online gaming and casinos tax levy. Once the decision on how to treat online gaming, horse racing, and casinos has been made, the taxation part will be easier to conclude.
The status of the GST rates rationalization committee's complete report could also be discussed during the 48th Council meeting in Madurai. Whether the report, which is looking at GST slab merger, which may lead to some of the goods and services prices rising, is presented, the GST council is unlikely to act upon it due to high inflation.
Initially, the rate rationalization GoM created on November 24, 2021, was due to present its report in November 2021 or within two months. Since then, the panel has had subsequent extensions. During its June meeting, the Council had given the Group of Ministers time until September to bring a full report.
According to the official, the Group of Ministers on Goods and Services Tax appellate tribunal already presented its report. However, the differences regarding GST on online gaming and casinos, including the Indian live casino sites, are still being resolved. The official added that the Council would meet within the first half of November.
At the June 28-29 meeting, the Council eliminated tax exemptions on several goods and services and rectified the inverted duty structure. During the 47th GST meeting held in Chandigarh in June, the Council approved the GoM's rate rationalization interim report, chaired by Karnataka Chief Minister Basavaraj Bommai. The panel got a three-month extension from the council for submitting a complete rate rationalization report and possible GST tax slab merger.
Dushyant Chautala, the Haryana deputy chief minister, led GoM, submitted its report about setting up a GSTAT (GST Appellate Tribunal) to Nirmala Sitharaman, the finance minister.
According to a source, the report has suggested one judicial member and one technical member in the GST Appellate Tribunal. The GSTAT will listen to appeals against the rules passed by the GST Appellate Authority, including tax officials.
The official added that the GoM on applicable Goods and Services Tax rate on horse racing, online gaming, and casinos is yet to reach an agreement, and a conclusion is expected soon. Conrad Sangma, Meghalaya chief minister-led GoM, had initially recommended levying 28% GST on horse racing, casinos, and online gaming.
Nonetheless, in June, the Council referred back to the panel's report for more discussion after Mauvin Godinho, Goa's finance minister, noted that there's a need for greater understanding and detailing of why casinos should have a varying taxation treatment from online gaming, including horse racing.
According to the official, it's yet to be unanimously decided to categorize online games as games of skill or chance. Suppose it's decided that horse racing and online gaming don't fall under games of chance but under games of skill; then the law must be interpreted with subtlety.
A law exists for a 30% TDS application on payouts. Each time somebody collects funds, they should be divided into two different accounts. One account should be an ESCROW, while the other account's deposit should attract a 28% GST. All payouts should go from the ESCROW account with the mandated 30% TDS.
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According to an official, the GST council might meet by mid-November to discuss the panel of ministers' report on creating a GST appellate tribunal and online gaming and casinos tax levy. Once the decision on how to treat online gaming, horse racing, and casinos has been made, the taxation part will be easier to conclude.
The status of the GST rates rationalization committee's complete report could also be discussed during the 48th Council meeting in Madurai. Whether the report, which is looking at GST slab merger, which may lead to some of the goods and services prices rising, is presented, the GST council is unlikely to act upon it due to high inflation.
Initially, the rate rationalization GoM created on November 24, 2021, was due to present its report in November 2021 or within two months. Since then, the panel has had subsequent extensions. During its June meeting, the Council had given the Group of Ministers time until September to bring a full report.
According to the official, the Group of Ministers on Goods and Services Tax appellate tribunal already presented its report. However, the differences regarding GST on online gaming and casinos, including the Indian live casino sites, are still being resolved. The official added that the Council would meet within the first half of November.
At the June 28-29 meeting, the Council eliminated tax exemptions on several goods and services and rectified the inverted duty structure. During the 47th GST meeting held in Chandigarh in June, the Council approved the GoM's rate rationalization interim report, chaired by Karnataka Chief Minister Basavaraj Bommai. The panel got a three-month extension from the council for submitting a complete rate rationalization report and possible GST tax slab merger.
Dushyant Chautala, the Haryana deputy chief minister, led GoM, submitted its report about setting up a GSTAT (GST Appellate Tribunal) to Nirmala Sitharaman, the finance minister.
According to a source, the report has suggested one judicial member and one technical member in the GST Appellate Tribunal. The GSTAT will listen to appeals against the rules passed by the GST Appellate Authority, including tax officials.
The official added that the GoM on applicable Goods and Services Tax rate on horse racing, online gaming, and casinos is yet to reach an agreement, and a conclusion is expected soon. Conrad Sangma, Meghalaya chief minister-led GoM, had initially recommended levying 28% GST on horse racing, casinos, and online gaming.
Nonetheless, in June, the Council referred back to the panel's report for more discussion after Mauvin Godinho, Goa's finance minister, noted that there's a need for greater understanding and detailing of why casinos should have a varying taxation treatment from online gaming, including horse racing.
According to the official, it's yet to be unanimously decided to categorize online games as games of skill or chance. Suppose it's decided that horse racing and online gaming don't fall under games of chance but under games of skill; then the law must be interpreted with subtlety.
A law exists for a 30% TDS application on payouts. Each time somebody collects funds, they should be divided into two different accounts. One account should be an ESCROW, while the other account's deposit should attract a 28% GST. All payouts should go from the ESCROW account with the mandated 30% TDS.
Content Produced by Indian Clicks, LLC
