Finance Ministry mulling to levy differential GST rate on online games as it attracts 18 per cent tax


The Finance Ministry is considering classifying online gaming into categories of skill and chance, and levying a differential rate of GST, an official said. Online games where winning is dependent on a certain outcome or is in the nature of betting or gambling would attract 28 per cent Goods and Services Tax (GST), while those which involve some amount of skill could be taxed at a lower 18 per cent.
A final decision on the taxation on online gaming would be taken by the GST Council in its next meeting, which is likely in May or June.
“All online games are not games of chance and are not in the nature of betting or gambling. The Finance Ministry will be presenting its view before the council,” the official told reporters here. The task would be to differentiate between what should be a game of skill and what can be called a game of chance. Currently, online gaming attracts 18 per cent GST. The tax is levied on gross gaming revenue, which is the fees charged by online gaming portals. A Group of Ministers, chaired Meghalaya Chief Minister Conrad Sangma, in December last year submitted a report on GST on online gaming to Finance Minister Nirmala Sitharaman.