Tax on Online Gaming, Casinos; Easing Compliance For Taxpayers: Here’s What To Expect From GST Meet Today

GST Council Meet Latest Update: The GST Council will begin its two-day meeting in Chandigarh from June 28. The Council is likely to make changes in goods and services tax (GST) rates on a handful of items and may also go with the officers panel’s recommendations to maintain status quo in rates of over 215 items. The 47th meeting of the GST Council, headed by Union Finance Minister Nirmala Sitharaman and comprising representatives of all states and UTs, is scheduled for June 28-29. The Council is meeting after a gap of six months.Also Read – GST On Cryptocurrency Soon? Council To Take Decision Next Week | Check Details Here

Apart from rate rationalisation, the Council is also expected to see a stormy discussion around compensation payout to states with Opposition-ruled states aggressively pushing for its continuation beyond the 5-year period which ends in June. Also Read – India’s Retail Inflation Eases to 7.04 Per Cent in May, From 7.79 Per Cent in April 2022

Key things to expect from GST meet:

GST Rate Rationalisation of Items: The GST Council nominated Fitment Committee has recommended to rationalise GST rates of a few items. Major changes proposed by the officers’ panel or the Fitment Committee in the tax rates are a uniform 5 per cent GST rate on prostheses (artificial limbs) and orthopaedic implants (trauma, spine, and arthoplasty implants). Besides, orthoses (splints, braces, belts and calipers) too have been proposed in the lowest bracket of 5 per cent. Also Read – Income Tax Return: Govt Says No Data Breach Reported on I-T Portal, Asks Infosys To Fix Glitch

Tax on Online Gaming, Casinos: The GST Council is also expected to consider a plan of the panel of state finance ministers on impose 28 per cent goods and services tax (GST) on online gaming, casinos and horse racing. The Group of Ministers, headed by Meghalaya chief minister Conrad Sangma, has in the meantime recommended that online gaming should be taxed at full value of the consideration, including contest entry fee paid by the player on participating in the game.

In casinos, the panel recommended that the tax would be imposed on the full face value of the chips/coins purchased from the casino by a player.

GST Council May Ease Compliance for the Taxpayers: The GST Council may also waive the requirement for filing refund claims between March 1, 2020, and February 28, 2022, in view of the disruption caused by the Covid-19 pandemic.  The council might also allow tax authorities to file appeals against erroneous refunds by not considering the two-year Covid period, according to reports.

Compensation for states: Apart from all this, there is likely to be a discussion on the continuation of compensation for revenue loss to states. The Opposition-ruled states are expected to push for the compensation in the future.

After the 45th GST Council meeting in Lucknow in September last year, Union Finance Minister Nirmala Sitharaman had said the regime of paying compensation to states for revenue shortfall resulting from subsuming their taxes such as VAT in the uniform national tax GST will end in June 2022.

However, the compensation cess, levied on luxury and demerit goods, will continue to be collected till March 2026 to repay the borrowings that were done in 2020-21 and 2021-22 to compensate states for GST revenue loss.

Goods and Services Tax (GST) was introduced in the country with effect from July 1, 2017 and states were assured of compensation for the loss of any revenue arising on account of implementation of GST for a period of five years.