Group of Ministers (GoM) to Suggest 28% GST on Online Gaming

GoM is a panel of state ministers set up by the government to evaluate casinos, online gaming, and racing services. The panel, led by Conrad Sangma, the chief minister of Meghalaya, met earlier this year to contemplate the valuation of casino and online gaming services.

At the meeting, GoM made a move to suggest a GST flat rate of 28% on online gaming, casinos, and races. A week after, the group concluded on a final recommendation on the rate on whether to charge the levy on gross gaming or each transaction.

One of the council members said that although there is a broad consensus on the 28% rate, they hadn’t decided what to levy. The options were between the gross revenue made from gaming or on a per-transaction basis.

Meanwhile, a few members of the council raised industry concerns that the tax rate on the industry should remain within the 18% slab. Nevertheless, GoM doesn’t make the final decision; it will submit its report to the council and the latter makes the final decision.

At present, there is a 28% GST rate on online betting or gambling games and 18% on skill-based games. Furthermore, the council levies a tax rate of 18% on the commission online gaming platforms collect for each game played.

The gaming industry demands that the tax should be on the gross gaming revenue, not on individual transactions. This report is stated by Mauvin Godinho, transport minister for Goa who is also a GoM member.

Additionally, the decision of the council will not only affect the gaming industry, but also other sectors directly linked to it. These sectors include the banking, payment gateway, entertainment, semiconductor, fintech, sports, and telecom sectors. Thus, the gaming industry makes a case that the GST rate on skill-based games should be left within the 18% slab.