Uttar Pradesh, West Bengal support GST Council’s decision to impose 28% tax on online gaming

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Uttar Pradesh Finance Minister Suresh Khanna commented on Thursday in support of the GST Council’s decision to levy 28% tax on full face value on online gaming.

Khanna said that having 5% GST on wheat flour while only 3% on online gaming was irrational. He added that the decision will only affect the rich, and the common public need not worry. The MLA from Shahjahanpur also said that not levying tax on gross gaming revenue was the right thing to do.

“The Uttar Pradesh government under the leadership of chief minister Yogi Adityanath has consistently maintained its stand on levying tax on online gaming,” Khanna said as quoted by Hindustan Times.

Similarly, West Bengal Finance Minister, Chandrima Bhattacharya also supported the Council’s decision, saying that their strong protest, amid some states’ (Delhi, Goa and Sikkim) disagreement, bore fruit as the Council retained the same tax rate in its 51st meeting.

During discussion on the West Bengal Goods and Services Tax (Amendment) Bill, 2023 in the state assembly, Bhattacharya said as quoted by Millennium Post, “I argued that online gaming has always been an actionable claim in the nature of betting and gambling considering its social impact and so it should not be made free. We have come across several instances of addiction to online gaming particularly among the children.”

The 50th GST Council meeting on July 11 had decided on the new GST rate with unanimity, she said. Bhattacharya further revealed that her protests were also supported by UP FM, and later the Union FM Nirmala Sitharaman took the final decision.

The 51st GST Council meeting, while finalizing the decision to levy tax on full face value, also announced that it will be imposed on initial deposits and not on every contest entry amount, providing some relief to online gaming companies.