The Goods and Services Tax (GST) Council has decided to levy a 28% tax on the full value of online gaming, horse riding, and casinos while exempting integrated GST (IGST) on certain drugs.
According to an official statement released by the finance ministry, the new Goods and Services Tax (GST) law will now be applicable to the face value of chips purchased in casinos, as well as bets placed in the context of horse riding and online gaming. This move aims to bring these forms of entertainment under the ambit of taxation and ensure a fair and transparent system.
While the implementation of this law has been announced, it has not been without its share of criticism. Some individuals and groups have voiced concerns regarding the implications and potential consequences of taxing these activities. One of the key points of contention revolves around the argument that taxing such forms of entertainment may have adverse effects on the industry.
Critics argue that imposing GST on the face value of chips or bets could potentially discourage participation and negatively impact the revenue generated by these sectors. They contend that individuals might choose to reduce their involvement in these activities, resulting in a decline in business for these platforms. Moreover, there are concerns that excessive taxation may drive some operations underground, leading to potential issues related to legality and regulation.
Amidst these criticisms, it is important to note that the implementation of the GST law on these activities is a result of a broader objective. The finance ministry’s intention behind this move is to bring these sectors into the formal economy and create a level playing field for all industries. The government says that the GST Council’s decision was made after careful consideration of various factors.
It is unclear how the government will respond to the issues raised by critics and stakeholders as the discussions surrounding the implementation of this law continue. Balancing the need for tax revenues with the potential impact on businesses and the overall economy will require careful consideration and possibly adjustments to the GST framework.