The government has amended the GST law, making it mandatory for foreign online gaming companies to register in India from October 1. However, the official said there is still no data on gaming companies foreign registered in India. So far, notices worth Rs 1 lakh crore have been issued by the Goods and Services Tax (GST) department for tax evasion and underpayment of taxes, a senior government official said. While the official refused to put a figure on the total number of notices issued by the GST department, he said the notices are being issued now because of the deadline for issuing notices for the financial year 2017-18 is about to end.
“So far, online gaming companies have received notices worth around Rs 1 lakh crore from the GST authorities regarding GST evasion, there are so many issues for which the notices have a reason was clearly given. The cases are being investigated. It will be difficult to quantify the amount of tax evasion,” the official said. The government has amended the GST law, making it mandatory for foreign online gaming companies to register in India from October 1. But the data is not yet available. foreign gaming companies registered in India, the official said. In August, the GST Council clarified that 28% Goods and Services Tax (GST) will be levied on the total value of bets on online gaming platforms. Since then, many gaming companies have received demand notices or show cause notices for underpayment of GST.
Rules for online gaming
The revised regulations and rules for online gaming, horse racing and casinos come into effect on October 1, introducing 28% face value GST at entry level and making registration mandatory. registration for overseas online gaming companies in India. Online gaming companies claim they are paying taxes at a rate of 18% because the games played on the platform are “games of skill.” While gaming company Dream11 has received show cause notices for evasion of Rs 40,000 crore, casino gaming company Delta Corp has received multiple notices from the GST regulator for a total amount of Rs 23,204 crore for non-payment of taxes. Delta Corp Ltd has obtained orders from the Goa Bench of the Bombay High Court and the Sikkim High Court restraining the tax authorities from taking any further action in connection with certain GST claim notices.
A series of GST notifications have also been issued by the authorities following sector-specific investigations in fields such as banking and insurance, later expanding to online gaming and casinos. Subsequently, the GST notification was expanded to cover “underpayment” of tax, “inaccurate use of input tax credit” and “reconciliation discrepancies” between returns filed and financial statements. main.
This is especially accelerated before the limitation period ends on September 30 for issuance of show cause notices for the financial year 2017-18, which is the first year of the GST regime. Notifications were also sent for the following years, from FY19 to FY22.
The Tax Department said the records were recorded using “data analytics supported by advanced technical tools”. In a statement on October 18, DGGI said it has detected GST evasion worth Rs 1.36 lakh crore so far in FY24, involving voluntary payments of Rs 14,108 crore.
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