The Goods and Services Tax (GST) Council has finalized a 28% GST rate on online gaming, casinos, and horse racing, which will come into effect from 1 October 2023. The new tax rate will be applied on the full value of the amount deposited by players.
The GST Council had been deliberating on the issue of taxation of online gaming for over a year. The central government had initially proposed a 28% GST rate on online gaming, but several states had opposed this, arguing that it would be too high and would stifle the growth of the industry.
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The GST Council eventually reached a compromise, agreeing to a 28% GST rate on online gaming, with a review after six months. The Council also decided to exclude redeployed winnings from the scope of GST.
The new GST rate is expected to have a significant impact on the online gaming industry. It is likely to lead to an increase in the cost of playing online games, and it may also discourage some people from playing altogether. However, the government hopes that the new tax revenue will help to offset the cost of providing public services.
Centre notifies New GST Rate on Online Gamingto be effective from October 1. Our story in paper today and the copy of notification. https://t.co/V4QK9tZzVw pic.twitter.com/vRjOZ6TChj
— Anuradha Shukla (@anu1122) September 30, 2023