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The Supreme Court on Wednesday upheld the retrospective 28 per cent Goods and Services Tax (GST) levy on online gaming companies as constitutionally valid.
A bench of Justices JB Pardiwala and R Mahadevan said online gaming platforms are not mere intermediaries but are to be treated as suppliers amenable to the GST regime on levies and taxes. The bench held that organised online gaming activities, including fantasy games involving pooled stakes and contingent price structures, give rise to actionable claims and supplies exigible to GST under the statutory framework governing betting and gambling transactions. It said that even skill-based games acquire the character of betting and gambling for GST once money is staked on uncertain outcomes. The online game operators are not mere intermediaries facilitating transactions inter-se between participants, but themselves constitute suppliers of such actionable claims, held the apex court. Online gaming companies had challenged the retrospective imposition of 28 per cent GST by the government. In 2023, Parliament amended the Central GST Act to introduce specific definitions relating to online money gaming and provided for a 28 per cent GST on the full face value of bets or deposits made by users, rather than only the platform's commission. (ANI)
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