FM Sitharaman to chair GST Council meeting today, to take key decision on 28% tax on online gaming

Finance Minister Nirmala Sitharaman will chair the GST Council meeting today where officials are expected to hold discussions on the 28 per cent tax on online gaming and chart out how it will be levied. The council is expected to determine the definition of online gaming for the purpose of taxing. Officials will decide whether games pertaining to skill or chance will also be considered under the ambit of tariff. The meeting will be held virtually. What happened in the previous meeting? In an earlier Goods and Services Tax meeting held last month, the council had decided to levy a 28 per cent tax on online gaming, horse racing and casinos. The Law Committee, comprising both Centre and State tax officers, has accordingly drafted rules based on the consideration of the GST Council. The GST Council will discuss the recommendations put forth by the Committee. Delhi FM to seek reconsideration  Delhi Finance Minister Atishi will seek reconsideration over the Council’s decision to levy 28 per cent tax on online games. The minister, who met representatives from the online gaming industry on Tuesday, said the issue will be raised by her at the meeting. “Last month the @GST_Council decided to impose a 28% tax on Online Gaming. Many entrepreneurs and investors from the start-up ecosystem opposed this decision, as they felt that it would destroy this fast-growing industry. Yesterday, I met several representatives from the Online Gaming industry to understand their concerns,” she said.

Last month the @GST_Council decided to impose a 28% tax on Online Gaming. Many entrepreneurs and investors from the start-up ecosystem opposed this decision, as they felt that it would destroy this fast growing industry.

Yesterday I met several representatives from the Online… pic.twitter.com/QAZFu4wrOi

— Atishi (@AtishiAAP) August 2, 2023

“Today the @GST_Council is meeting again, and I will ask the Council to reconsider its decision. Promoting start-ups and entrepreneurship is the only way our economy is going to grow!” she tweeted. Gaming industry unhappy  According to a report by Mint, the All India Gaming Federation (AIGF), representing companies like Nazara, GamesKraft, Zupee, and Winzo, termed the decision to levy tax on online gaming as “unconstitutional, irrational, and egregious”. Meanwhile, gaming companies in Tier II and Tier III cities wrote a letter to FM Sitharaman, saying that high taxation might force gamers to adopt illegal means and use offshore platforms.