The panel of state finance ministers is unanimous on raising the GST rate for casinos, racetracks and online gaming services to 28 percent, West Bengal Finance Minister Chandrima Bhattacharya said Monday.
However, a decision as to whether the tax should be levied on gross or net worth would be made after further consultation at the officer level. The Group of Ministers (GvM) decides on the manner in which the services are valued.
Right now, casino services, horse racing and online gaming attract 18 percent GST (Goods and Services Tax).
The government had set up a panel of state ministers in May last year to better value casino services, online gaming portals and racing courses for the levy of GST.
The GoM, led by Meghalaya Prime Minister Conrad Sangma, met on Monday and discussed the applicable GST rate for these three services.
“There was a clear consensus that the highest rate of 28 percent should be levied on all three services: casino, racetrack and online gaming.
“The officers committee will further deliberate and report within 10 days on whether the tax will be levied on gross or net worth, after which the GoM will meet again and make a phone call,” Bhattarcharya said.
She said the GoM’s decision would take into account companies involved in these services, society and other stakeholders.
The GoM report is likely to be discussed at the next GST Council meeting expected later this month.
Other state ministers in the 8-member GoM include Maharashtra Deputy Prime Minister Ajit Pawar, Gujarat Finance Minister Kanubhai Patel, Goa Panchayati Raj Minister Mauvin Godinho, Tamil Nadu Finance Minister P Thiaga Rajan, Uttar Pradesh Finance Minister Suresh Khanna and Telangana Finance Minister T Harish Rao.
Rajat Mohan, senior partner of AMRG & Associates, said valuing online gaming, horse racing and casino services is a matter of frequent lawsuits and industry harassment.
“Hopefully, future tax rules would put a stop to the multiple interpretations assigned by tax offices across the country and align taxation with global best practices, allowing the industry to thrive,” added Mohan.