clerl.tax

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  • Game Changer — The GST has revolutionized India’s economy.

    This Post discusses the perspectives of Arun Goyal, a retired Indian Administrative Service officer, who is now a member of the Central Electricity Regulatory Commission. Notably, he played a crucial role as an additional secretary during the GST Council’s launch of the Goods and Services Tax (GST), showcasing his deep experience in regulatory matters and commitment to driving impactful change in India’s economic landscape.

    Six years after the implementation of the Goods and Services Tax (GST), it is evident that this reform, with its unique features such as the Dual GST structure and the Integrated GST mechanism, has indeed yielded substantial benefits for the Indian economy. The GST Council, functioning as a model of cooperative federalism, has facilitated decisions on tax rates, exemptions, and revenue-sharing, showcasing a collaborative effort between the central and state governments.

    The commendable performance of the Goods and Services Tax Network (GSTN) in providing a seamless interface for taxpayers and governments has resulted in significant formalization of the economy. This is demonstrated by the remarkable increase in GST registrations, contributing to higher revenues. The growth from ₹8.76 trillion in 2018-19 to ₹13.25 trillion in 2022-23 is a testament to the effectiveness of the GST regime.

    While the initial concept of invoice matching faced challenges, subsequent measures such as e-way bills and e-invoicing have been introduced to curb GST leakages. The standardization of electronic invoice formats and the adoption of these mechanisms have contributed to minimizing fraudulent GST invoices and ensuring proper claim of input tax credit.

    However, it is essential to acknowledge that India’s GST system still faces certain concerns. The multiple tax slabs, particularly the high peak rates of 18% and 28%, have been critiqued for their complexity and potential to promote tax evasion. Comparing this to other countries with simpler GST structures, the need to reduce the number of slabs and peak rates becomes apparent.

    The next phase of GST reforms should prioritize streamlining the number of tax slabs and reducing peak rates to achieve tax buoyancy, aligning with the positive trajectory observed in India’s direct tax rates. This approach will not only simplify GST administration but also enhance the effectiveness of the GST system in driving economic growth and reducing tax evasion.

  • Lok Sabha Approves Amendments for 28% GST on Online Gaming

    The Lok Sabha has given its approval to changes made in two Goods and Services Tax (GST) bills. These changes focus on imposing a 28% tax on activities like online gaming, casinos, and horse race clubs. These amendments were introduced by Finance Minister Nirmala Sitharaman during the monsoon session of Parliament.

    The purpose of these changes is to modify the Central and Integrated GST laws. The proposed tax rate of 28% would be applicable to the entire nominal value of bets placed in online gaming, casinos, and horse race clubs. This move is aimed at generating revenue from these sectors.

    The bills that were passed are known as the Central Goods and Services Tax (Amendment) Bill, 2023, and The Integrated Goods and Services Tax (Amendment) Bill, 2023. Despite some protests, these bills were approved in the Lok Sabha.

    The key changes include adding new clauses to Schedule III of the CGST Act, 2017. These clauses provide clear guidelines for how transactions related to casinos, horse racing, and online gaming should be taxed. Similarly, amendments within the IGST Act stipulate that offshore entities involved in online money gaming must register for GST in India.

    Furthermore, these revisions include provisions that allow authorities to block access to offshore online gaming platforms if they fail to comply with registration and tax payment requirements in India.

    It’s worth noting that these amendments received the green light from the GST Council in the previous week. The council agreed to impose a 28% GST on the total nominal value of bets placed in online gaming, casinos, and horse racing. This decision was taken with the aim of bringing in additional tax revenue.

  • Union Cabinet Clears Bill to Amend GST Laws for Online Gaming, Casinos, and Horse Racing

    The Union Cabinet on Wednesday cleared a bill to amend laws to bring clarity related to the uniform 28 percent GST at full face value for online gaming, casinos, and horse racing, government sources confirmed. The statutes to be amended through the latest bill include CGST, IGST, and UT GST laws.

    The bill is expected to be introduced during the remaining days of the monsoon session of Parliament. The GST Council, in its meeting on July 11, recommended taxing casinos, horse racing, and online gaming at the uniform rate of 28 percent. Tax will be applicable on the face value of the chips purchased in the case of casinos, the full value of the bets placed with the bookmaker/totalisator in the case of horse racing, and the full value of the bets placed in online gaming. The mechanism was further approved at the next meeting of the council on August 2.

    Amendments and Recommendations

    “Suitable amendments to be made to the law to include online gaming and horse racing in schedule III as taxable actionable claims,” the council recommends. Further, it recommended inserting a specific provision in IGST Act, 2017, “to provide for liability to pay GST on the supply of online money gaming by a supplier located outside India to a person in India, for single registration in India for the said supplier through a simplified registration scheme and also for blocking access by the public to any information generated, transmitted, received, or hosted in any computer resource used for the supply of online money gaming by such a supplier in case of failure to comply with provisions of registration and payment of tax.”

    It was also said that the valuation of the supply of online gaming and actionable claims in casinos may be based on the amount paid or payable to or deposited with the supplier, by or on behalf of the player (excluding the amount entered into games/bets out of winnings of previous games/bets) and not on the total value of each bet placed. The council recommended that CGST Rules, 2017, may be amended to insert specific provisions for the valuation of the supply of online gaming and the supply of actionable claims in casinos accordingly. The council also recommended the issuance of certain notifications/amendments in the notification related to the issue.

    Implementation and Impact

    Once the Centre amends the CGST, IGST, and UT GST laws, then the states and two Union territories with Assemblies will be required to bring similar changes in SGST Acts. After the legislative changes, detailed rules will be announced. The target is to complete all these steps by the next month-end to ensure implementation from October 1, 2023.

    On August 2, during a GST Council meeting, Delhi asked if the taxation matter, especially pertaining to online gaming, could be referred back to the group of ministers (GoM). Ministers from Goa and Sikkim called for a review of the 28 percent rate on the entire face value as against gross gaming revenue (GGR or service fee charged) in the case of casinos, as this would hurt their interests, given that they are small states. Andhra Pradesh reportedly called for a “large heart” to consider the valuation base. In view of these developments, the mechanism will be reviewed six months from the date of implementation.

    The mechanism is expected to step up revenues. Revenue Secretary Sanjay Malhotra had earlier said that last year (2022-23) the exchequer collected only Rs 1,700 crore as GST, and this could have been Rs 15,000-20,000 crore had the tax been levied on the full value.

  • Indian Banks Engage in Branch Opening Spree with Focus on Deposits

    In the realm of Indian banking, particularly within the enclave of private sector institutions, a conspicuous defiance of the presumption that digital transactions would consign physical branches to obsolescence has taken shape. In a bold and strategic move, these banks are orchestrating a fervent expansion of their branch networks, spurning the predicted diminution of brick-and-mortar establishments. This expansion is not merely a numerical surge but a carefully calculated strategy to harvest deposits and bestow more attentive service upon customers, particularly in the semi-urban and rural domains.

    The Embellishment

    Amid this orchestrated expansion, the grandiose HDFC Bank, India’s preeminent private financial establishment, has evidenced prodigious growth within its branch constellation. During the preceding quarter, a commendable tally of 39 new branches was seamlessly incorporated. In the annals of the last fiscal year, a near-mythical addition of approximately 1,500 branches graced the bank’s portfolio, propelling the cumulative branch count to the cusp of 7,900. Astoundingly, more than 40% of these were erected within the ephemeral bounds of the past three years, fortifying the institution’s presence for an extensive clientele of 85 million, with a conspicuous emphasis on the semi-urban and rural frontiers. The vista ahead unfolds a strategic blueprint for the incorporation of an additional 1,500 to 2,000 branches within the ongoing year.

    Parallel in aspiration, ICICI Bank, another titanic name within the private banking pantheon, ceremoniously unveiled an augmentation of 174 branches during the same quarter, thereby embellishing its overall constellation to an impressive 6,074. The preceding financial year inscribed an account of 482 new branches, attesting to its steadfast commitment to nurturing its expanding empire.

    Axis Bank, yet another indomitable bastion of private banking, has spiritedly joined this race for the amplification of its branch tapestry. The recent quarter bore witness to the graceful addition of 42 branches, culminating in a cumulative total of 4,945. It bears mention that the antecedent fiscal year bore witness to the incorporation of over 300 branches, and as the present financial year unfolds its chapters, aspirations of a supplementary 400 branches make their presence felt.

    The saga unfolds further with IndusInd Bank, adorned with 2,606 branches, unfurling a tapestry of ambition. A proclamation of 30 launch-ready branches resonates, while leases are being meticulously ratified for an additional 27. As the annual chronicles unfurl, the resonance of 250-300 new branches dances through the air, emblematic of a strategic foray into realization.

    The Philosophical Grounding

    Concurrent with the crescendo of digital transactions, a fundamental truth remains ensconced within the consciousness of these banks – that physical branches wield a pivotal role in the theater of customer engagement. Especially in the rural and semi-urban outposts, these establishments acknowledge the irreplaceable importance of tactile interactions. The elegant fusion of digital marvels with tangible touchpoints, often christened as “phygital branches,” materializes as a sagacious endeavor to bestow patrons with a sense of engagement and an impenetrable aura of security. Beyond this, the tangible emporiums persist as vanguards in the realm of mobilizing deposits and tending to a spectrum of intricate customer exigencies.

    It is within this orchestrated crescendo that the resonance of branch expansion reverberates, poised to reverberate through the corridors of ATM penetration, particularly in the stratified tiers III to VI enclaves. This concerted push captures the banks’ unflinching determination to harness the fullest potential of their existent foundations, whilst propelling growth through a sophisticated network. In the throes of an ever-evolving financial landscape, these institutions astutely straddle the precipice between digital innovations and tangible services, engineering an equilibrium that elegantly caters to the exacting needs of their discerning clientele.

  • Calcutta High Court’s Landmark Decision on GST Credit Denial Due to Supplier Tax Non-Payment

    In a groundbreaking ruling, the Calcutta High Court emphasized that the denial of input tax credit (ITC) under GST cannot occur automatically solely due to discrepancies between GSTR-2A and GSTR-3B. This verdict underscores the necessity for an investigation into the supplier’s tax situation before rejecting ITC. This judgment brings substantial relief to companies grappling with demand notices stemming from the supplier’s failure to report or pay taxes.

    The Calcutta High Court stated firmly in a verdict dated August 2, 2023, “There shall not be any automatic reversal of input tax credit from the buyer on non-payment of tax by the seller… In case of a default in payment of tax by the seller, recovery shall be made from the seller.” This declaration was made by a two-judge Bench composed of Chief Justice T S Sivagnanam and Justice Hiranmay Bhattacharyya.

    Nevertheless, the court also outlined that the revenue authorities retain the option to reverse GST input tax credit from the buyer in specific instances such as a missing dealer, supplier business closure, or inadequate supplier assets.

    The court’s deliberation was prompted by the ‘Suncraft Energy Private Ltd and Another Vs The Assistant Commissioner, State Tax, Ballygunge Charge, and Others’ case. This case revolved around GST input tax credit obtained by Suncraft Energy for purchases from a supplier. The revenue authority later overturned the ITC due to the supplier’s tax non-payment, citing some invoices not being reflected in Suncraft Energy’s GSTR-2A for the 2017-18 financial year.

    In this recent judgment, the Calcutta High Court drew on the precedents set by the Supreme Court in cases like Bharti Airtel and Arise India Ltd, leading to the reversal of orders by the Assistant Commissioner, State Tax, Ballygunge.

    Niraj Bagri, a partner at Dhruva Advisors, expressed, “The Calcutta High Court’s decision comes as a huge relief to companies besieged by demand notices resulting from supplier tax non-payment. These notices were served despite the purchasing companies fully compensating the supplier for goods and taxes.”

    Bagri added that the court firmly held that demand notices cannot be issued to compliant purchasing companies without proper investigations at the supplier’s end or attempts to recover the tax dues from the supplier.

    “This ruling will notably alleviate the plight of industries facing demand notices across various states due to tax credit mismatches, despite companies duly paying taxes to the supplier,” Bagri remarked.

    Notably, last month, Punjab AAR’s advance ruling denied ITC to a taxpayer due to its supplier’s default. Despite the taxpayer’s assertion that they lacked mechanisms to ensure the supplier’s compliance, the authority interpreted Section 16(2)(c) of the CGST Act strictly, resulting in ITC denial.

    Abhishek Jain, partner and national head (indirect tax) at KPMG, highlighted, “The upheld principles in this ruling are warmly welcomed, particularly the initiation of recovery proceedings against defaulting suppliers concerning legitimate recipients. This principle’s overall affirmation will substantially reduce litigation, as investigations will be directed solely toward defaulting suppliers in relation to numerous recipients.”

  • Calcutta HC Declares Landmark GST Ruling, Denying Automatic ITC Denial for Supplier Tax Non-Payment

    Landmark Decision by Calcutta High Court: Buyers’ GST Credits Safe Even Amidst Supplier Tax Defaults

    In a significant legal ruling, the Calcutta High Court has taken a firm stance regarding GST input tax credit (ITC) under the Goods and Services Tax (GST) system. The court has decreed that the mere mismatch between GSTR-2A and GSTR-3B forms cannot lead to automatic denial of ITC, without a proper investigation into the supplier’s actions. This pronouncement is set to offer substantial relief to companies that have been grappling with demand notices triggered by discrepancies in tax reporting or non-payment by their suppliers.

    Expressing its verdict on August 2, 2023, the Calcutta High Court emphasized, “There shall not be any automatic reversal of input tax credit from the buyer on non-payment of tax by the seller. In case of a default in payment of tax by the seller, recovery shall be made from the seller.” This unequivocal judgment was rendered by a two-judge Bench, presided over by Chief Justice T S Sivagnanam and Justice Hiranmay Bhattacharyya.

    Nevertheless, the court acknowledged that the option to reverse GST input tax credit from the buyer will still remain at the disposal of revenue authorities, specifically in cases deemed “exceptional,” such as instances involving missing dealers, business closures by suppliers, or insufficient assets held by the supplier.

    This landmark verdict emerged from the case titled ‘Suncraft Energy Private Ltd and Another Vs The Assistant Commissioner, State Tax, Ballygunge Charge and Others’. Here, Suncraft Energy had availed GST input tax credit for its procurement from a supplier. However, this credit was subsequently revoked by the revenue authority due to the supplier’s failure to fulfill tax obligations. Notably, certain invoices from the supplier were not reflected in Suncraft Energy’s GSTR 2A for the fiscal year 2017-18.

    Relying on prior judgments by the Supreme Court in the Bharti Airtel and Arise India Ltd cases, the Calcutta High Court overturned the decisions of the Assistant Commissioner, State Tax, Ballygunge. This judgment reiterates that the imposition of demand notices on purchasing companies, despite these companies having fulfilled their payment obligations, is unjustified without a comprehensive inquiry into the suppliers’ conduct and without pursuing tax recovery measures against the suppliers themselves.

    Niraj Bagri, a partner at Dhruva Advisors, applauded the ruling, stating, “The Calcutta High Court has provided substantial relief to companies facing unwarranted demand notices due to the suppliers’ non-compliance. This judgment asserts that purchasing companies cannot be held accountable without a thorough investigation into the suppliers’ actions or without recovering the tax dues directly from the suppliers.”

    This verdict is expected to alleviate the woes of various industries that have been inundated with demand notices across different states, stemming from discrepancies in tax credit, even though the purchasing companies have fulfilled their tax obligations to the suppliers.

    A previous ruling by the Punjab Authority for Advance Ruling (AAR) had rejected input tax credit for a taxpayer due to the default of its supplier. Despite the taxpayer’s argument that they lacked a mechanism to ensure compliance by their suppliers, the AAR invoked Section 16(2)(c) of the CGST Act to deny ITC. In light of the Calcutta High Court’s recent ruling, this kind of approach is now set to be reassessed, potentially reducing legal disputes and shifting the focus of inquiries to the defaulting suppliers rather than the genuine recipients.

    Abhishek Jain, partner and national head (indirect tax) at KPMG, welcomed the principles upheld in this ruling, emphasizing the importance of pursuing recovery proceedings against defaulting suppliers rather than burdening bona fide recipients with unnecessary litigations. This approach, he noted, has the potential to streamline numerous cases and ensure that investigations are primarily directed at suppliers who fail to fulfill their tax obligations.

  • The burden of 12% GST on Hostel Accommodation

    Students seeking hostel accommodation will face an increase in expenses, as a recent ruling from the Authority of Advance Ruling imposes a 12% GST on rent payments. This decision, rendered in separate instances by the Bengaluru and Lucknow benches of the AAR, asserts that hostels should not be treated as equivalent to residential dwellings and, consequently, are ineligible for Goods and Services Tax exemption.

    Srisai Luxurious Stay LLP, in their quest for a clarification on GST, was informed that the exemption applied only to accommodation services costing up to Rs 1,000 per day, a provision applicable until July 17, 2022.

    The Bengaluru bench of the AAR clarified, “PG/Hostel Rent paid by inhabitants do not qualify for GST exemption… as the services provided by the applicant are not akin to renting of residential dwelling for use as residence.”

    Furthermore, the decision indicated that GST under reverse charge would be applicable to the rental payments made to landowners by the applicant, requiring the applicant to secure GST registration.

    Explaining the distinction, the bench stated, “Residential dwelling is a residential accommodation meant for permanent stay and does not include guest house, lodge or like places. In the instant case, the applicant in his own admission claims to be providing PG/hostel services which inter alia refer to ‘paying guest accommodation / hostel’ services and are akin to guest house and lodging services and therefore can’t be termed as residential dwelling.”

    A parallel scenario involving Noida-based V S Institute & Hostel Pvt Ltd clarified that hostel accommodations below Rs 1,000 per day would also be subject to GST, beginning on July 18, 2022.

    Rajat Mohan, Senior Partner at AMRG & Associates, shared concerns about the implications of the 12% tax on student accommodations in hostels and dormitories, projecting an increased financial burden on Indian families. Mohan proposed that the GST council should contemplate strategies to mitigate the tax impact on the entire educational ecosystem, including student accommodation. This would help alleviate the additional costs faced by students and families in pursuit of education.

  • Truck Driver Dies of Shock after Being Detained by GST Officials on His Way to See Deceased Son


    A distressing incident unfolded as a 49-year-old truck driver, en route to Punjab after learning about his son’s tragic passing, was apprehended by State Goods and Service Tax (SGST) authorities on GT Road. The unfortunate turn of events culminated in the driver’s demise within his vehicle that same night, reportedly due to the overwhelming shock he experienced.

    Balbir Singh, hailing from Ludhiana’s Aslamganj, was returning from Kanpur with a load of goods from the Koyla Nagar region. It was during this journey that he received the heart-wrenching news of his son Mahesh’s accidental death, caused by electrocution.

    As Balbir Singh made his way home to bid a final farewell to his son, he was intercepted by Joint Commissioners of GST SIB, Amit Mohan, and Parasnath Yadav, who were conducting a routine inspection near Geeta Nagar Metro station in Kanpur around 1:30 pm on a Friday afternoon.

    Despite his earnest appeals, the officials declined Balbir Singh’s plea to return home and pay his respects to his son for the last time.

    In an unwarranted turn of events, the officials forcibly transported Balbir Singh and his truck to the GST office in Lakhanpur. Tragically, Balbir Singh was discovered lifeless in his truck when the officers approached him to deliver a notice on Sunday afternoon.

    Upon learning of his father’s untimely demise, Govind, Balbir Singh’s elder son, promptly journeyed from Ludhiana to Kanpur, accompanied by his brothers-in-law Sonu and Bharatram. After identifying his father’s body, Govind swiftly demanded action against the GST officers responsible.

    “My younger brother, Mahesh, lost his life due to electrocution. Upon receiving this grievous news, my father rushed to Kanpur. However, the GST officers obstructed his journey, compelling him to their office. The profound sorrow and shock of being denied the opportunity to bid his own son a final farewell proved too overwhelming for him,” Govind expressed.

    Additionally, Govind shared that he had refrained from informing his mother about Balbir Singh’s demise, fearing the tremendous shock of losing her husband and son in such a brief span of time.

    “The insensitivity displayed by the GST officers has shattered our entire family. It is imperative that strict measures are taken against them,” he asserted.

    Outrage Erupts, Protest Unfolds at GST Office

    This tragic incident has ignited fury within the local business community, prompting them to organize a protest at the GST office. Gyanesh Mishra, the president of Akhil Bharatiya Vyapar Mandal, demanded immediate compensation for Balbir Singh’s grieving family and called for decisive action against the SGST officers accountable for this grievous outcome.

    Legal proceedings have been initiated against the involved GST officers, with a further investigation underway.

  • GST Refunds for Cancelled Contracts — Supplier Obligations

    Government entities or suppliers consistently aim to have an advantage in their interactions with private businesses. When contracts are nullified, a common concern arises about managing the previously paid GST, particularly if there’s no applicable outward tax liability. Addressing this matter, Serial Number 3 of Circular Number 137/07/2020-GST dated 13/4/2020 outlines the subsequent details —

    Situation 01

    An instance arises where a supplier receives payment in advance for a service contract, which later gets canceled. The supplier had already sent an invoice before actually providing the service and had paid the corresponding GST on it. Now, the question is whether the supplier can get a refund for the tax paid, or if they need to manage their tax obligations differently in their records.

    When a supplier pays GST on the advance received for a service that was later canceled, and if this advance was tied to an invoice issued even before the service was given, the supplier needs to generate something called a “credit note.” This process is defined in section 34 of the CGST Act. The supplier should include all the specifics of this credit note in the tax return for the month in which the credit note was produced. The tax responsibility will then be adjusted within this tax return, all according to the terms outlined in section 34 of the CGST Act. Importantly, this doesn’t require a separate application for a tax refund. However, if there’s no tax obligation against which this credit note can be balanced, individuals registered under GST can go forward and initiate a claim for any “Excess payment of tax,” if applicable. This can be done using FORM GST RFD-01.

    Situation 02

    Imagine a situation where a company gets paid in advance for a service they were supposed to provide. But later, the plans change, and the service doesn’t happen. The company already paid a tax called GST on that advance money. Now, the company wants to know if they can get that tax money back or if they have to adjust it against their other taxes.

    If a company pays GST on the money they got in advance for an event that got canceled, and they didn’t give an official bill (invoice) as per the GST rules, they need to make a special note (a “refund voucher”) as per the rules. Then, they can ask for the GST money back by filling out a form called GST RFD-01, saying they paid too much tax.

    Calcutta High Court

    Now, let’s think about when the company gets the GST money back. There was a case with a company called IRCTC. They got paid by someone for a service, including GST, and then the plans got canceled. IRCTC said they’d give back the GST money, but only if the government also gives them money back. This is even though the person who paid said they didn’t use that GST money for any tax benefits.

    The Calcutta High Court looked at a similar case involving Griham Food and Hotel Private against the government. The Court said that there’s no reason why the GST money shouldn’t be given back to the petitioner. The Court didn’t agree that IRCTC should always get money back from the government. IRCTC couldn’t show why they waited so long to deal with the petitioner’s request for a GST refund. If the government should give money back to IRCTC will depend on the law. But it’s clear that the petitioner should get the GST money back from IRCTC. So, IRCTC was told to give the GST money back to the petitioner quickly.

  • Ashneer Grover Slams 28% GST on Online Gaming

    Ashneer Grover, a prominent figure in the Indian tech landscape and co-founder of BharatPe, has fiercely criticized the recent decision of the GST Council to impose a heavy 28% Goods and Services Tax (GST) on online gaming. This decision holds significant consequences for various gaming companies, such as Dream11, MPL, Gameskraft, and Games 24×7.

    In a fervent tweet, Grover lambasted the government’s move to levy the highest GST rate on online games, labeling it as a potential obliteration of India’s thriving gaming sector. He argued that this abrupt imposition necessitates tech startup founders to delve into politics, underlining the urgency for their voices to find resonance. Grover’s apprehensions are tightly intertwined with his own venture, Crickpe, a mobile game centered around fantasy cricket. Crickpe allows users to not only indulge in the game but also to earn money through paid leagues and victorious cash pools.

    With unmistakable frustration, Grover tweeted, “Farewell – Genuine currency gaming industry in India. If the government believes that people will stake Rs 100 to participate in a Rs 72 prize pool contest (bearing 28% Gross GST), and if they pocket Rs 54 (after accounting for platform fees), they will then be subjected to a 30% TDS on that amount – an imposition that supposedly grants them an indoor swimming pool during the first monsoon – an absurd notion!

    His tweet goes on to assert, “It was an enjoyable journey being part of the fantasy gaming industry, which now stands vanquished. $10 Billion squandered in this season of downpours. It’s time for startup pioneers to step into the realm of politics and secure representation – lest we witness one industry’s downfall after another.”

    Grover’s pointed remarks were a direct response to the GST Council’s decision to enforce a 28% tax on online gaming. This elevated tax rate will be applicable to the entire value of transactions within the sphere of online gaming. This move will inevitably impact multiple gaming entities, including Dream11, MPL, Gameskraft, and Games 24×7.

    Echoing Grover’s sentiments, India’s most seasoned and extensive online gaming consortium, the All India Gaming Federation, along with the E-Gaming Federation and the Federation of Indian Fantasy Sports (FIFS), have expressed their displeasure with the council’s decision to raise the GST on online skill games from 18% to 28%.

    In a collective statement, these three industry bodies have expressed their concern about certain media reports hinting at the imposition of taxes on the overall prize pool (inclusive of pooled prize money and platform commissions), rather than solely on the Gross Gaming Revenue (GGR). They opine that if the latter scenario unfolds, it could spell doom for the online skill gaming sector in India.

    Roland Lander, CEO of the All India Gaming Federation, articulated in a statement that the combination of heightened tax rates and the imposition of taxes on the entire entry fee (as opposed to GGR) would prove “catastrophic for the industry, stifling its potential right at its inception.