Preparations to levy GST on online games at the rate of 28% have been completed. With the implementation of the new system, while the fans of playing online games are going to get a big blow, the government exchequer is also going to get huge benefits. According to an estimate, increasing the indirect tax rate on online gaming could fetch the government an additional Rs 45-50 thousand crores.
The bill has been passed by Parliament.
The GST Council, the apex body that takes any decision on the new indirect tax regime, had proposed taxing online games at a rate of 28 percent. After passing necessary amendments to the law, the bill was tabled in the Monsoon Session of Parliament. Two related bills have been approved in Parliament. Soon the new law will come into effect, which will make online gaming enthusiasts spend more money than before, while the government will earn a lot of money.
Opinion of DGGI officials
A recent ET report quoted officials of the Directorate General of GST Intelligence, or DGGI, as saying that if GST is levied at 28% on online gaming, the government would lose Rs 50,000 crore. can earn up to According to the authorities, online gaming companies used to pay tax at the rate of 18 percent on their income, but now they have to pay 28 percent tax on their income since 2017.
Calculation will be done from 2017 onwards only.
After the new rules come into force, the liability on online gaming companies will be calculated only from 2017, when the new indirect tax regime i.e. GST came into force. DGGI officials say that if the calculation is made from 2017 till now, this calculation will be 45 to 50 thousand crore rupees. According to him, the government can now earn an additional revenue of Rs 45-50 thousand crores from online gaming companies.
In these cases more tax will have to be paid.
The GST Council in its recently held 50th meeting had decided to change the tax rates on online games, casino and horse racing. GST will now be levied at the rate of 28% on online gaming, casino and horse racing. This tax will be levied on the entire amount wagered. Similarly, in the case of a casino, the price of the chip purchased will be taxed. This tax has to be paid by the companies providing online games.
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