GST Council India’s Needs Help To Figure Out Gambling Taxes

Home » GST Council India’s Needs Help To Figure Out Gambling Taxes

India’s Goods & Services Tax (GST) Council rewrote its tax code some months back. In actual fact, they didn’t rewrite anything. What they did was to re-interpret all that was there previously. This move has not gone down well with casino operators as they are now required to pay a massive sum of money.

In light of this, stakeholders in the gambling sector have been trying their best for the GST Council to ease up, all to no avail. All they’re asking for is that the tax rates be reduced, or for the council to change how it calculates their tax.

News reaching us is that that the Group of Ministers (GoM), through a panel that was created at the start of this year, is the only one with the right to take any action on the matter.

The issue comes in two ways – the first is how lottery taxes are collected, and the second is how taxes on gambling are calculated. The Maharashtra Finance Minister, Sudhir Mungantiwar, established the GoM panel to assess how GST rates can be applied on lottery ticket sales.

State lotteries are required to pay a rate of 12%, while private distributors pay a rate of 28%. Some people feel these double rates are unconstitutional. The Calcutta High Court ruled that existing laws allow the for such changes,

“It is within the domain of such Council to decide the rate of tax.”

Moves made by companies in the gambling sector to change this rate yielded no fruits during a meeting with the GST Council last week, according to reports from the Goan Daily Herald. Almost all council members, including Nirmala Sitharaman the Union’s Finance Minister, voted against the operator’s demands.

Another thing causing argument is the interpretation of the current tax code by the GST Council. The council stresses that taxes have to be paid on the bet’s face value, which most in the gambling industry say is not feasible.

From the look of things, it seems the council doesn’t want to make the call and is leaving it for the GoM to make.

The Chief Minister Of Goa, Pramod Sawant, had this to say,

“There was some issue on GST on gross revenue, which has now been handed over to the Group of Ministers for further discussion. It is for the GST council to decide.”

For now, the casinos do not have the anywhere to turn to, and it seems the Indian government can’t put things under especially issues related to the gambling sector under control. For now, no date has been set to the awaited ruling from the GoM, or if they’ll also shy away like the GST did.


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