In a move to enhance revenue, the Maharashtra Government aims to collect an additional ₹700 crore annually from online gaming and associated industries, including betting, casinos, and horse-racing, leveraging the recently passed Maharashtra Goods and Services Tax (Amendment) Act. Under the amended legislation, the tax rate on online gaming and related sectors has been elevated to 28% of the aggregated amount, aligning with the central GST law.
This amendment is a key outcome of the winter session of the assembly, and brings about significant changes in taxation and enforcement to boost the state’s financial position. Furthermore, the jurisdiction of the law has been extended to cover portals operating from outside the country, marking a widespread effort to regulate tax entities that may attempt to evade the tax net.
An official from the state GST department mentioned to the Hindustan Times in an interview that GST numbers are now mandatory for all operators engaging players from Maharashtra. This stringent requirement aims to prevent operators from claiming foreign IP addresses to evade taxes, as the authorities now possess the authority to block such IP addresses.
Another official from the Finance Department stated the substantial growth of the online gaming industry, projecting a 30% annual increase over the next five years. This growth is also prevalent in rural areas, not limited to Maharashtra but extending to other states as well. The imposition of higher taxes on portals, coupled with more robust enforcement measures, is expected to act as a deterrent, especially for players within the 15-35 age group.
The GST officials said the amendment of elevating GST to 28% would help tighten enforcement and reduce tax evasion. The recent change in legislation empowers authorities to recover taxes from entities attempting to evade their financial duties. This move signifies a comprehensive approach to boosting revenue and also regulating and ensuring compliance within the growing online gaming industry.