Online Gaming GST: Companies stare at additional tax demand of Rs 45,000 crore

The online gaming companies that had classified themselves as platforms providing game of skill could be facing an additional tax outflow of Rs 45,000 crore, reported Economic Times.

As per the report, the Central Board of Indirect Taxes and Customs (CBIC) has assessed the pending GST liabilities of such companies at about this level since the 2017 rollout of the levy as they paid 18% on gross gaming revenue, being games of skill, instead of the 28% prescribed in the law, officials said. The differential taxation between games of skill and chance has come to an end.

"Our internal assessment says that the gaming industry alone has paid ₹45,000 crore less tax since the implementation of GST," a senior official from CBIC told Economic Times.

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The report also mentioned that the Directorate General of GST Intelligence is in the process of issuing notices to these companies. The gaming industry alone has paid less than Rs 5,000 crore GST since 2017 while it has a liability at over Rs 50,000 crore.

The Parliament last week approved the amendments to the IGST and CGST laws that would implement the changes proposed by the GST council