Union Finance Minister Nirmala Sitharaman will table bills to amend the Central Goods and Service Tax Act, 2017 and Integrated GST Act 2017 in the Lok Sabha today. The amendments aim to provide enabling provisions to tax online games at 28%. The bill will later be taken up for consideration and passing.
It may be noted that on July 11, the GST Council – the apex body on GST matters – unanimously 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.
In a follow-up meeting on the issue on August 2, the Council 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. Actionable claim is the legal right to receive payments in lieu of goods or services, including any legal obligation.
The online gaming industry has been up in arms against the move and has made numerous representations to the finance ministry as well as prime minister Narendra Modi. After the July meeting of the Council, domestic as well as foreign investors in the gaming sector gave a detailed presentation to PM Narendra Modi urging the government to roll back the high tax imposed on the sector. Domestic companies wrote to the finance ministry on the ill impact of the move on the sector.
