Goods and Services Tax (GST): The group of ministers (GoM) for casinos, online gaming and horse racing, tasked with investigating the issue of levying 28 percent GST on these activities, met on Tuesday and the meeting remained unclear, a source told CNBC. TV18. † The panel was given until July 15 to investigate the matter and submit a new report.
The GoM, led by Meghalaya Chief Minister of the GST Council, Conrad Sangma, discussed the valuation mechanism and considered that GST should be levied on gross gaming revenue, according to international best practices, and not on the general pool as previously stated. recommended, the source said.
The source also said that GoM members were all on board to levy 28 percent GST on all three activities: online gaming, casinos and racing courses. The group has not yet made a decision on which part will be taxed.
The group of ministers may meet again before August 10 to finalize its recommendations and submit its report.
The GoM had previously recommended taxing online gaming at the full value of the consideration, including the entry fee that the player pays for participating in the game. In the case of racing courses, the GoM has recommended levying GST on the full value of bets collected in the totalizers and placed with the bookmakers.
After the 47th meeting of the GST Council at the end of June, the Union’s Finance Minister Nirmala Sitharaman said that at first glance the Council considered that the common thread connecting them is that these activities are of the nature of “gamble” and should be taxed accordingly.
She added that the Prime Minister of Goa believed that casinos should be treated differently from the other activities – horse racing, online gaming and lottery. The finance minister also said the government has been given until July 15 to study and submit a new report. The council will meet exclusively in the first week of August to discuss the new GoM report and a final decision will be made.
The GoM had recommended that no distinction be made for the levy of GST on the basis of skill or games of chance. The panel added that GST’s rate on all such activities should be 28 percent.
With regard to the valuation, the GoM had previously said that in the case of online gaming, the full consideration, including the entry fee for the competition, must be paid by the player for participation. It added that in the case of racing courses, it must be the full value of the bets collected in the totalizer and placed with bookmakers. It also said that for casino valuation, it should be the full face value of chips/coins purchased by a player from the casino.
The GoM also said that once GST is levied on purchases of chips/coins (at face value), no further GST should apply to the value of bets placed on any betting round, including those involving winnings from previous rounds. The entrance fee to casinos, including the price of one or more other necessities such as food, drink, etc., will be 28 percent.
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