Online gaming ruining young generation, 28% GST rate is a means to counter the problem: Ajit Pawar

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Maharashtra Deputy Chief Minister Ajit Pawar, while speaking in the Legislative Council on December 11, claimed that online gaming is ruining the young generation by giving rise to financial and mental problems due to losses and addiction.

However, he also stated that online gaming cannot simply be outright banned due to several legal difficulties. In order to counter this problem, Finance Minister Nirmala Sitharaman appointed a GoM which looked into the matter and recommended that it should be brought under the 28% GST slab.

With a similar viewpoint, the GST Council then decided to implement the 28% GST rate on full face value of initial deposits for online gaming.

The rationale here was that all online gaming activities that consist an element of wagering will be put under the 28% GST category, be it games of skill or games of chance. Pawar also highlighted that there needs to be a clarity between skill games and chance games.

As of now, the GST amendment bill has been passed in the legislative assembly during the winter session in Nagpur. It will now make its way into the legislative council for debate.

Pawar also spoke on the topic of casinos. He reminded that imposing 28% GST on casinos does not mean they are allowed in the state, as they are banned. The state recently passed a bill to repeal the Maharashtra Casinos (Control and Taxes) Act, 1976, shutting down any possibility of casinos being run.

With regard to banning online gaming, Pawar said that Devendra Fadnavis, who is also acting as the Deputy Chief Minister, has presented a bill to ban it. It has been passed by the assembly and will be now be tabled in the legislative council.