The Finance Ministry is considering classifying online gaming into the categories of games of skill and luck and levying Goods and Services Tax (GST) at different rates. An officer gave this information.
Online games where the decision of winning or losing depends on a certain outcome or is in the nature of betting or gambling will attract GST at the rate of 28 per cent.
Online games of skill could be taxed as low as 18 per cent. The final decision on taxing online gaming will be taken by the GST Council in its next meeting in May or June.
“All online games are not based on luck, or are in the nature of betting or gambling,” the official told reporters here. The Finance Ministry will place its views before the Council.
He said that a distinction has to be made between a game based on skill and a game based on luck. Currently, online gaming attracts 18 percent GST. The tax is levied on the total fee charged by the online gaming portal.
A Group of Ministers headed by Meghalaya Chief Minister Conrad Sangma had submitted a report on GST on online gaming to Finance Minister Nirmala Sitharaman in December last year. However, the final decision in this regard has to be taken by the GST Council.
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