𝗦𝘂𝗽𝗿𝗲𝗺𝗲 𝗖𝗼𝘂𝗿𝘁 𝗛𝗲𝗮𝗿𝗶𝗻𝗴 𝗼𝗻 𝗚𝗦𝗧 𝗔𝗽𝗽𝗹𝗶𝗰𝗮𝗯𝗶𝗹𝗶𝘁𝘆 𝘁𝗼 𝗢𝗻𝗹𝗶𝗻𝗲 𝗚𝗮𝗺𝗶𝗻𝗴 – 𝗠𝗮𝘆 𝟭4, 𝟮𝟬𝟮𝟱
As of May 14, 2025, the Supreme Court of India is conducting hearings on the applicability of a 28% Goods and Services Tax (GST) on online gaming platforms. This case is pivotal in determining whether online games involving monetary stakes should be classified as gambling or as games of skill for taxation purposes.
𝗞𝗲𝘆 𝗜𝘀𝘀𝘂𝗲𝘀 𝗨𝗻𝗱𝗲𝗿 𝗖𝗼𝗻𝘀𝗶𝗱𝗲𝗿𝗮𝘁𝗶𝗼𝗻:
𝗖𝗹𝗮𝘀𝘀𝗶𝗳𝗶𝗰𝗮𝘁𝗶𝗼𝗻 𝗼𝗳 𝗚𝗮𝗺𝗲𝘀:
𝗚𝗼𝘃𝗲𝗿𝗻𝗺𝗲𝗻𝘁’𝘀 𝗦𝘁𝗮𝗻𝗰𝗲: The government argues that any game involving monetary stakes, regardless of whether it is skill-based or chance-based, constitutes gambling and should be taxed at 28% GST.
𝗚𝗮𝗺𝗶𝗻𝗴 𝗖𝗼𝗺𝗽𝗮𝗻𝗶𝗲𝘀: Argument: Online gaming companies contend that games like rummy and fantasy sports are skill-based and have been legally recognized as such for decades. They argue that imposing a 28% GST on these games is unjustified.
𝗧𝗮𝘅 𝗕𝗮𝘀𝗲 𝗳𝗼𝗿 𝗚𝗦𝗧:
𝗚𝗼𝘃𝗲𝗿𝗻𝗺𝗲𝗻𝘁’𝘀 𝗣𝗼𝘀𝗶𝘁𝗶𝗼𝗻: The 28% GST should be levied on the total amount staked by players, including the prize pool.
𝗚𝗮𝗺𝗶𝗻𝗴 𝗖𝗼𝗺𝗽𝗮𝗻𝗶𝗲𝘀 𝗩𝗶𝗲𝘄: GST should apply only to the platform fees or commissions earned by the gaming companies, not on the entire amount staked by players.
𝗥𝗲𝘁𝗿𝗼𝘀𝗽𝗲𝗰𝘁𝗶𝘃𝗲 𝗔𝗽𝗽𝗹𝗶𝗰𝗮𝘁𝗶𝗼𝗻:
𝗚𝗼𝘃𝗲𝗿𝗻𝗺𝗲𝗻𝘁’𝘀 𝗔𝗽𝗽𝗿𝗼𝗮𝗰𝗵: The government has issued tax notices totaling approximately ₹1.12 lakh crore to various online gaming companies, applying the 28% GST retrospectively from July 2017.
𝗜𝗻𝗱𝘂𝘀𝘁𝗿𝘆’𝘀 𝗖𝗼𝗻𝗰𝗲𝗿𝗻: Gaming companies argue that the retrospective application of the tax is detrimental to the industry and could lead to significant financial burdens.
mint
𝗖𝘂𝗿𝗿𝗲𝗻𝘁 𝗦𝘁𝗮𝘁𝘂𝘀:
The Supreme Court’s hearings on this matter are ongoing with the final judgment expected to have significant implications for the online gaming industry’s regulatory and taxation framework in India.
