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Delay in Group Of Ministers (GoM) reports on online gaming, casinos and GST Appellate Tribunals has pushed the goods and services tax (GST) council meeting to September 2022 now. 

As GoMs are still not ready with their reports, the GST Council is likely to meet at the end of September, CNBCTV18 shared in a tweet quoting sources.

The GoM, formed by the Finance Ministry to review the GST rate for online gaming, casino, and horse racing, was supposed to submit its final report on the issue before the second week of August.

On July 12, the GoM met to discuss the issue. However, the meeting didn’t reach any conclusion in deciding the GST rate due to absence of certain members and information at that time. 

Currently, the GST rate for online gaming is at 18%, whereas it is at 0% on contest entry fee. The GoM recommended that a 28% GST should be levied on online gaming with the full value of the consideration, including the contest entry fee paid by the player for participation in such games. 

The stakeholders in the online gaming industry raised concerns over the hike in GST rate and many of them opined that such a steep tax rate would affect the business case, eventually leading to shutdown of many gaming startups. 

However, what could be a big relief to the industry, the GoM is likely to impose a 28% tax on gross gaming revenue (GGR), as per reports.

Although the final recommendations are still awaited, the 28% GST only on GGR rather than imposing a blanket 28% GST on online gaming will be a big boost for the industry, said All India Gaming Federation CEO Roland Landers to Inc42 earlier.

“Our (AIGF) only request has been to charge GST on the Gross Gaming Revenue, which is the practice that has always been followed and is also globally accepted,” he said.

The GoM was formed last year to examine the valuation issues of services provided by casinos, race courses and online gaming and if any change is required in the legal provisions to adopt any better means of valuation of the same.