Finance Ministry Wants Different GST Rates For Online Games Of Skill

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The Finance Ministry of India has proposed different GST rates for online games of skill and games of chance. Currently, online games are taxed at a uniform rate of 18%, regardless of whether they are games of skill or games of chance. However, the Finance Ministry has proposed that games of skill be taxed at a lower rate of 12%, while games of chance be taxed at a higher rate of 28%. This move is intended to differentiate between the two types of games and to incentivize the development of skill-based games. The proposal is expected to be discussed at the next GST Council meeting.

According to recent reports, the Indian Finance Ministry has proposed different GST rates for online games of skill and games of chance. Currently, both categories of online gaming are taxed at a rate of 28% under the Goods and Services Tax (GST) regime. The Ministry’s proposal suggests reducing the GST rate for online games of skill to 18% while maintaining the current 28% rate for online games of chance.

The proposal comes after several representations made by industry bodies such as the All India Gaming Federation (AIGF) and the Online Rummy Federation (ORF) requesting the government to classify online games of skill separately and reduce the GST rate on them. The industry argues that online games of skill are based on player expertise and strategy rather than chance, and therefore, should not be taxed at the same rate as online games of chance, which are based purely on luck.

The Ministry’s proposal is currently under consideration and is expected to be finalized soon. If approved, it could provide some relief to the online gaming industry and boost growth in the sector.