The government on Friday notified amendments to GST law in relation to the valuation methodology to be adopted by online gaming companies and casinos for calculating tax.
The Ministry of Finance notified amendments to Central GST law for calculating value of supply in case of online gaming and casinos as per the decision of the GST Council last month.
EY Tax Partner Saurabh Agarwal said this shall effectively settle the ambiguity and uncertainty around this issue. "However, the aspect of whether mere deposit of money in a wallet qualifies as a supply is unclear, and may possibly be challenged by industry," Agarwal added.
AMRG & Associates Senior Partner Rajat Mohan said under the valuation rules, the full tax rate would be applicable on the total amount paid to online gaming company/ casinos, without any relief to the taxpayer in case of refund/return of money.
Notification clarified that winnings by any player would remain tax-neutral, as the entire tax is collected at first stage only.
"Until now, the government has not indicated any transitional provisions for the current cash buy-ins in the player pools. We can expect the government to clarify this position through a circular in the coming few months," Mohan added.
Also Read
Delta Corp posts 19% higher profit on sustained casino gaming demand
GST spurts fiscal equality: tax-GSDP ratio higher in poorer states
GST evasion of Rs 30,000 crore using stolen IDs across 16 states uncovered
Input tax credit not available for GST paid on CSR work expenses: UP AAR
Shares of Indian gaming, casino firms drop after 28% GST imposition
UK acknowledges possible encryption hurdles as online safety law looms
Agro-chemical industry can grow 9% despite Chinese competition: NITI Aayog
Sugar demand-supply would be comfortable in next season, says Centre
Mohali to Manila: Rice economy faces turmoil as El Nino turns up heat
CCI issues draft norms on combinations under amended competition law
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)