GST council meeting to decide on Online gaming compensation today

The Goods and Services Tax (Council) is going to meet again on Wednesday to discuss crucial issues of GST compensation to states beyond June 2022 and 28 per cent tax on casinos, online gaming and horse racing.

The opposition states on Monday pushed forward their demands of either extending the period of compensation to the States by another two years or to change the revenue sharing pattern, by increasing states’ share in GST revenue from the current 50% to 70%.

While the centre is reluctant to accept any of these demands, it may allow some head rooms to support states with weak revenue growth.

On Tuesday the council approved e-way bill on intra-state movement of gold, gold jewellery and precious stones to check evasion, the Council recommended that states can decide on the threshold above which the electronic bill is to be made mandatory.

The group of ministers on online gaming casinos, headed by Meghalaya Chief Minister Conrad Sangma had submitted a report to the council, recommending the highest 28% tax on these activities.

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Sources said that the council is likely to accept the report.

On Tuesday the council decided to do away the exemption on host of items and services, including packaged curd, lassi, buttermilk, foodgrains, cereals, honey, papad and a host of unbranded food items besides hotel rooms and a with tariff below Rs 1000 per night, hospital rooms with daily tariff of Rs 5000 are set to become taxable. The timeline for the implementation of the decision is likely to be decided on Wednesday.

It also suggested making post office services other than postcards and inland letters, book posts and envelopes weighing less than 10 gm, to be taxed.

The council also recommended that

cheques, loose or in book, should be taxed at 18%.

The council is also learnt to have accepted recommendations of GoM on GST system reforms headed by Maharashtra finance minister Ajit Pawar, which has suggested stricter scrutiny and verification of high-risk taxpayers and mandatory presentation of electricity bill during time of registration.

The GoM has also suggested public disclosure of information of unregistered bogus traders and certification of taxpayers’ bank accounts by National Payments Corporation of India (NPCI).

Finance minister Nirmala Sitharaman is going to brief the media on the outcome of the GST council report in the evening.

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