The GST Council has clarified the value of supply for online gaming, casinos and horseracing.
India.- The central government of India has published a series of amendments to the CGST Rules 2017, making changes to the taxation landscape for online gaming, casinos, and horseracing. The primary amendment introduces a 28 per cent tax rate for these sectors, with a tentative implementation date of October 1, pending notification by the government.
Under these amendments, the value of supplies in online gaming will be based on the total amount deposited by a user or player, without the possibility of GST adjustment in case of refunds. This approach aims to capture the full economic value of these transactions. To fully enact the changes, individual states must also amend their GST laws before the proposed implementation deadline.
A critical modification entails the mandatory registration of offshore gaming companies. A monitoring cell, overseen by the Directorate General of GST Intelligence (DGGI), will be responsible for ensuring that the companies comply. While the amendments are not retroactive, the revenue secretary clarified that they primarily serve as a clarification, as betting, gambling and lottery activities were already subject to a 28 per cent tax under GST law.