look news india
New Delhi: Supreme Court has given relief to online gaming companies. The Supreme Court has stayed the Centre’s show cause notice demanding Rs 1.12 lakh crore GST from online gaming companies. After this decision, online gaming companies have suffered a setback. The court has put a stay on all proceedings under the notice until a conclusive case is reached.
The main controversy in the matter of tax collection from online gaming companies is regarding the implementation of GST on online gaming activities. The government is insisting that a 28 percent GST be imposed on the total contest entry amount, taxing the entire prize pool.
Gaming companies argue against the government’s stance that GST can only be levied on their platform fees or commissions, saying that many of these games are based on gaming rather than mere chance or luck.
Tax partner Ernst & Young said the final hearing in March will play an important role in opening up the regulatory framework and ensuring the industry has a fair and transparent taxation system. Aggarwal said that the Supreme Court has given a big relief to the online gaming and casino industries by staying the show cause notice of the Directorate General of Intelligence (DGCI).
This move by the Supreme Court reflects the need for legal clarity and due process for this sector, which is growing rapidly and in need of regulation. After the Supreme Court’s decision, online gaming companies must be breathing a sigh of relief.
