The gaming sector will now have to wait until after a new central government is formed for a review of the 28 per cent goods and services tax (GST) imposed last October.
The review was originally meant to be conducted at the conclusion of a six-month period ending March 31 this year, but scheduling constraints, among others, have meant that the federal GST Council is unlikely to meet until June this year.
The Election Commission of India is expected to announce the dates for the Lok Sabha next week, following which the election code of conduct will come into effect. This code prevents any major policy decision from being taken.
In fact, the present union government’s council of ministers met for the last time earlier this Sunday. A meeting of the Union Cabinet has also been held today on major policy decisions.
The decision to review the 28 per cent tax on online gaming and casinos six months after its implementation on October 1, 2023 was initially announced during the 51st GST Council meeting in August 2023. The review process, set to take place after March 31, 2023, involves the participation of member states and the GST secretariat.
“We require the council's presence to address this issue. Decisions are made through a consensus-based approach between the Centre and states, necessitating a majority vote of at least three-fourths of the present members. Although an amendment has been made regarding online gaming, we await the cooperation of states to determine the future course of action,” officials aware of the developments told Business Today TV.
According to the procedure, meetings of the GST Council must be communicated to all members at least seven days in advance of the scheduled date. However, there is a provision for emergency meetings with a notice period of two days, subject to approval by the Chairperson of the Council, the Union Finance Minister.
In addition to the review of GST on online gaming, the GST Council had reconstituted the Group of Ministers (GoM) to address pending matters regarding the simplification of tax slabs. This too is expected to now convene only after the new government takes over at the centre.
Despite the existence of four main GST rate slabs—5 per cent, 12 per cent, 18 per cent and 28 per cent, variations have led to nearly a dozen different rates, with some goods at zero rate as well.
The reconstituted GoM on GST rate rationalization is chaired by Uttar Pradesh Finance Minister Suresh Kumar Khanna, while the members include Karnataka Revenue Minister Krishna Byre Gowda, Goa Minister for Transport, Panchayati Raj, Housing, Protocol, and Legislative Affairs Mauvin Godinha, Bihar Finance Minister Vijay Kumar Chaudhary, Kerala Finance Minister KN Balagopal and West Bengal Finance Minister Chandrima Bhattacharya.
Source: Business Today
