India: GST detects US$41.67m tax evasion by lottery distributors

The GST found that lottery distributors had evaded taxes since July 2017.

India.- The GST department has detected Rs. 344 crores (US$41.67m) in tax evasion by lottery distributors from July 2017 to February 2023. It’s not clear where the evasion took place, but few states permit lottery sales, including West Bengal, which earns significant revenue from lottery sales.

The Ministry of Finance said there had been no tax evasion detected in paper lottery sales in neighbouring Bihar, Jharkhand and Odisha.

The Ministry of Finance said Rs. 352.95 crores, including interest and penalties, have been recovered from lottery distributors from the inception of GST in 2017 until February 2023. The ministry confirmed that there is no proposal to create a lottery regulator in the country.

Effective March 1, 2020, the country’s states and state-licensed lotteries are subject to a flat GST of 28 per cent. In the past, lotteries were taxed under two blocks based on category.