Finance minister Nirmala Sitharaman is likely to introduce amendments to the Central GST law on Friday and seek its passage during the monsoon session of Parliament as the government races against time to arm itself with powers to levy tax on online games, casinos and horse racing.
The Union Cabinet on Wednesday approved changes to GST laws to add them to the schedule for levy of 28% GST on online games, casinos and horse racing. The amendments to the GST laws were cleared by the GST Council last week, with Sitharaman indicating that the Centre and the states are looking to impose tax from October. Along with the amendment by the Centre, the states will also introduce changes to their laws. The monsoon session is scheduled to end on Friday, with Thursday earmarked for the no-trust vote. The FM had made it amply clear that there was no rethink on the move, amid intense lobbying by gaming companies, who have found support from the Delhi government. States such as Goa and Sikkim had also sought a review, but breaking from tradition, the GST Council decided to record their dissent and go ahead with the proposed levy.
The amended provisions in GST laws would specifically define online gaming, online money gaming, virtual digital assets used to pay for online games and suppliers in case of online gaming. The Council had also recommended inserting a provision in the IGST Act, to impose GST on online money gaming provided by offshore entities. Such entities would be required to get GST registration in India. The amendments will also provide for blocking access to online gaming platforms located overseas in case of failure to comply with registration and tax payment provisions.
