Need clarity on ambiguities on GST regime on online gaming: Association

New Delhi: Union Finance and Corporate Affairs Minister Nirmala Sitharaman chairs the 39th GST Council meeting, in New Delhi on March 14, 2020. Also seen Union MoS Finance and Corporate Affairs Anurag Thakur. (Photo: IANS/PIB)

Panaji, May 19 (IANS) The All India Gaming Federation on Thursday has called for clarity on the ambiguities on the Goods and Services Tax regime on online gaming, a day after the GST Council’s Group of Ministers (GoM) recommended hiking of GST to the tune of 28 per cent on casino, race course and online gaming services.

In a statement issued on Thursday, Roland Landers, CEO of All India Gaming Federation said that the gaming industry awaits a clear judgment on GST restructuring and rate rationalisations on the online games.

“While it is clear that the GST valuation will likely be at 28 per cent, there however seems to be a lot of confusion on the valuation methodology including initial sum, Gross Gaming Revenue and total deposits being reported in the media. I believe that any other valuation other than commission/service fees will be disastrous for the gaming industry,” Landers said.

The Federation’s top official also said that the rapidly expanding online gaming industry is expected to be a significant contributor to the economy, on account of which it was imperative that the GST regime for the industry is “rational and progressive”.

“The valuation mechanism in collecting GST on the whole stake esteem versus the service fee component should be laid out clearly to avoid any ambiguities or potential litigations. Any potential outcomes of this litigation will adversely impact the entrants of new players and fostering innovative strategies,” Landers said.

“That’s not all, another reason for GST to be applicable only on service fee is because in case it is applicable on the entire pool value then it would adversely impact the customers, as well as they would get less playable value and encourage the push towards gray markets operators,” he added.

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