Union Finance Minister Smt. Nirmala Sitharaman has presented the Central/ Integrated Goods and Services Tax (CGST/IGST) Amendment Bills, 2023 in the Lok Sabha today, which have been passed by the Lok Sabha. These bills relates to levy of 28% tax on online gaming, casinos and horse racing.
After the passage of these bills, decks are clear for imposition of 28% GST on online gaming, casinos and horse racing. Accordingly, the State assemblies can also pass similar amendments in their respective State GST laws.
CGST Amendment Bill 2023
The CGST Amendment Bill, 2023 provides for following amendments:
(i) to define the expressions “online gaming”, “online money gaming”, “specified actionable claim” and “virtual digital asset”;
(ii) to insert a proviso in the definition of “supplier” to provide clarity regarding “supplier” in case of supply of “specified actionable claim”;
(iii) to substitute “specified actionable claim” in paragraph 6 of Schedule III of the
Act, for the present entries “lottery, betting and gambling”, so as to provide clarity
regarding taxability of actionable claims involved in or by way of casinos, horse racing and online gaming; and
(iv) to insert a new clause in section 24 of the CGST Act, to provide for mandatory
registration of the person for supplying online money gaming, from a place outside India to a person in India.
IGST Amendment Bill 2023
The IGST Amendment Bill, 2023 provides for following amendments:
(i) to amend clause (17) of section 2 of the IGST Act to exclude online money gaming from the definition of Online Information and Data Access or Retrieval (OIDAR) services;
(ii) amend the proviso to sub-section (1) of section 5 of the IGST Act, to provide that in case of import of such goods, that may be notified by the Government on the recommendations of the GST Council, the levy of Integrated Goods and Services Tax (IGST) may not be required to be done in accordance with the provisions of section 3 of the Customs Tariff Act, 1975 read with section 12 of the Customs Act, 1962 and instead, the same shall be levied and collected as inter-State supply as per the provisions of sub-section (1) of section 5 of the Act;
(iii) to amend section 10 of the IGST Act, to provide that where the supply of goods is made to a person other than a registered person, the place of supply shall be the location as per the address of the said person recorded in the invoice issued and be the location of the supplier where the address of the said person is not recorded in the invoice; and
(iv) to insert a new section, section 14A in the IGST Act, to provide for special provision for online money gaming supplied by a person located outside the taxable territory to a person located in India, including requirement of taking a single registration under the Simplified Registration Scheme; payment of Integrated Tax on such supplies and provision for blocking of access by the public to any information generated, transmitted, received or hosted in any computer resource used for supply of online money gaming by such supplier in case of failure to comply with provisions of registration and payment of tax in such manner as specified in the Information Technology Act, 2000.
The amended provisions in the CGST/IGST law are expected to be implemented in due course, from October 1, 2023.
CGST Amendment Bill, 2023 dated 11/08/2023: Taxation of Online Gaming and Casinos
IGST Amendment Bill, 2023 dated 11/08/2023: Taxation of Online Gaming and Casinos
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