The Supreme Court on Monday sought responses from the Central government and the Directorate General of Goods and Services Tax Intelligence in response to a plea filed by online gaming companies challenging the imposition of a 28 percent Goods and Service Tax (GST) on all forms of online real-money gaming.
A bench of Chief Justice of India DY Chandrachud, along with Justices JB Pardiwala and Manoj Misra, issued a notice after hearing the counsel for the gaming companies, Senior Advocate Harish Salve.
The petitioners, including Dream 11, Games 24×7, and Head Digital Works, have raised concerns regarding the GST Council’s decision during its 50th meeting in July 2023. The Council recommended that online gaming, casinos, and horse racing should be subjected to a uniform tax rate. The Council further emphasized the elimination of any distinction between “games of skill” and “games of chance.”
In the previous year, the Central government had proposed the introduction of regulations for online gaming through amendments to the Information Technology. Subsequently, these draft Rules were notified a few months later. Notably, the draft Rules explicitly define a gaming platform as an “online gaming intermediary,” with registered games overseen by a “self-regulatory body” comprised of a board of directors or governing body.
The regulatory body, as per the proposal, is required to be registered by the ministry upon submission of an application by the body itself.
