• Notification Date: 14-08-2023
• Notification No: N/A

28% GST on Online Gaming, Casinos: Lok Sabha passes Amendments to Central, Integrated GST Laws

Lok Sabha on Friday passed the bill seeking amendments to the Integrated Goods and Service Tax Act, 2017, and the Central Goods and Service Tax Act, 2017 to levy a 28 per cent tax on the full-face value of bets in online gaming, casinos and horse race clubs. 
   
Earlier in the day, Union Finance Minister Nirmala Sitharaman introduced two bills Central Goods and Services Tax (Amendment) Bill, 2023, and The Integrated Goods and Services Tax (Amendment) Bill, 2023, in the lower house amid opposition protests over suspension of Congress leader Adhir Ranjan Chowdhury from the House. 

The amendments to the Central GST (CGST) and Integrated GST (IGST) laws were approved by the GST Council last week. The council had approved levy of 28 per cent GST on full face value of entry level bets in online gaming, casinos and horse racing. 

Friday is the last day of the monsoon session of Parliament.  

The amendments pertain to the insertion of a provision in the Schedule III of the CGST Act, 2017, to provide clarity on the taxation of supplies in casinos, horse racing, and online gaming. 

On the other hand, the amendment in IGST Act relates to inserting a provision to impose GST liability on online money gaming provided by offshore entities. Such entities would be required to get GST registration in India. 

The amendments will also provide for blocking access to online gaming platforms located overseas in case of failure to comply with registration and tax payment provisions. 

On July 11, the GST Council decided to bring online gaming, horse racing and casinos under the 28% GST bracket. The slab applies uniformly to both skill and chance-based games. 

Following feedback from different groups, stakeholders, the Council on August 2 decided on the modalities of implementation and enabling provisions, amendments that need to be made in the bills to bring online gaming under the ambit of taxable action subject to claim, among others.  

The online gaming industry has resisted the move and has made numerous representations to the finance ministry and the Centre urging it to roll back the high tax imposed on the sector. 

Domestic companies have also written to the finance ministry on the ill impact of the move on the sector.