Recently in the GST Council Meet in New Delhi, a 28% hike on online gaming and horse racing, and casinos were introduced in full volume. Partner of N.A Shah Associates said, “GST of 28% on the full value of bets on online gaming, horse racing and casino will be a major damper in the gaming industry. The online gaming companies will be hit in a big way.”
In the previous meeting, the FICCI on behalf of the gaming community urged the government or CBIC (Central Board of Indirect Taxes & Customs) that a 28 percent hike would be extremely detrimental to their survival as hardly any business operations can be performed with such high taxation.
Ashneer Grover, former co-founder of Bharatpe tweeted condemning the policy, “RIP – Real money gaming industry in India. If the govt. is thinking people will put in 100 rupees to play on 72 rupees pot entry (28% Gross GST); and if they win 54 (after platform fees) – they will pay 30% TDS on that – for which they will get free swimming pool in their living room come the first monsoon – not happening! It was good fun being part of the fantasy gaming industry, which stands murdered now. $10Bn down the drain in this monsoon. Time for startups Founders to enter politics and be represented – or this is going to be spate industry after industry.” He also hold the fantasy gaming named Crickpe for virtual in-form gaming team of best players and rain points according to the performance.
In addition to that, taxes of SUV and MPV vehicles will rise by 2% with cess increasing on a 200 basis points from 20% to 22% now. On the other hand, cinema hall restaurants GST got concession of 5% from the earlier GST charged at 18%, while 5% GST will be charged for fish & soluble paste & uncooked food palette. Also, FSMP and cancer drug, Dinutuximab to treat rare diseases is likely to be abated from 12% in the next council meeting.
Overall, the council meeting put record high percentage of GST for some accessories or online business, whereas it has also gave redemption on some accessories. So, it will bring a major change in the taxability of some businesses & a new dimension in the tax collection of the revenue department of India.