1 lakh crore notice to online gaming companies: GST authorities seek answers regarding Goods and Services Tax

Show cause notices worth Rs 1 lakh crore have so far been issued by GST authorities to online gaming companies regarding Goods and Services Tax (GST). A senior government official has given this information to the media.

This matter pertains to the period till October 1, 2023, in which GST is being levied on the services of online gaming companies at the rate of 28% instead of Goods and Services Tax of 18%.

After the 52nd GST Council meeting, the government had clarified that the 28% tax liability on online gaming is not applicable as of now. Rather it already exists.

Companies say that GST should be imposed on these at the rate of 18% only. There is a tussle going on between the tax authorities and online gaming companies regarding this.

28% GST on online gaming from October 1

Let us tell you that 28% Goods and Services Tax (GST) has started being imposed on online gaming from October 1. In July, the GST Council had announced the imposition of 28% GST on online gaming, horse-racing and casino. The final decision on this was taken in the 51st meeting on August 2. Till now these games were taxed at 18%.

Recently, Central Board of Indirect Taxes and Customs (CBIC) Chairman Sanjay Aggarwal had said that 28% GST will be imposed on online gaming from October 1. He said that legal notices have also been sent to gaming companies as part of its implementation process. It will be reviewed after 6 months of its implementation.