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Supreme Court Backs 28 per Cent GST Levy on Online Gaming
The court said betting and gambling lose skill protection when money is involved, and it restored a Rs 21,000 crore GST notice against Gameskraft.
- In a major ruling Wednesday, the Supreme Court of India upheld a 28% retrospective GST demand on online gaming, ruling the levy is constitutionally valid and does not violate Articles 366 and 366 of the Constitution.
- After the GST Council imposed 28 percent tax on full online gaming face values in 2023, gaming companies received show cause notices and challenged the retrospective application to periods before October 1, 2023.
- Justices J. B. Pardiwala and R. Mahadevan noted that "when the element of betting and gambling enters the picture, the nature of the game ceases to be of relevance," while the bench accepted state concerns over addiction and suicides linked to online gaming.
- The judgment reversed the Karnataka High Court's favor to Gameskraft by restoring the Rs 21,000 crore show-cause notice and upheld Tamil Nadu and Karnataka laws criminalizing online games played for money.
- Gaming platforms' arguments that GST should apply only to gross gaming revenue rather than full deposit amounts remain economically contested, with final implementation decisions left to GST authorities under this ruling.
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SC upholds govt retrospective 28% GST levy on online gaming companies
The Supreme Court has backed the government's retrospective 28% GST on online gaming. The court ruled that online gaming platforms are not intermediaries and their activities are taxable. This decision impacts past transactions and tax demands. Online gaming companies had challenged the retrospective tax, arguing skill-based games are not gambling. The government's interpretation now applies to these past events.
·India
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Total News Sources15
Leaning Left2Leaning Right4Center0Last UpdatedBias Distribution67% Right
Bias Distribution
- 67% of the sources lean Right
67% Right
L 33%
R 67%
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