The Centre on Saturday defended the notices sent to online gaming firms for payment of taxes saying these firms are liable to pay taxes under the earlier law also and thus there is no retrospective demands even though some states flagged the issue saying the dues demanded from some firms is much more than their turnover.
Some states like Goa and Delhi raised the issue of tax notices to online gaming firms during the 52nd GST Council meeting.
Talking to reporters after the meeting Chhattisgarh Deputy Chief Minister T S Singh Deo said some states raised the issue during the meeting. “There were discussions on charges on these companies retrospectively. Because DGGI (Directorate General of GST Intelligence) is an independent body there cannot be any interference. The (GST Council) chairperson said she would make clarifications available to the DGGI, if required,” he said.
Delhi Finance Minister Atishi said tax notices are being sent for a much higher amount than even the estimated valuation of the gaming industry.
Talking to reporters before the GST Council meeting, Atishi said tax evasion notices worth Rs 1.5 lakh crore have been sent to online gaming companies. “The imposition of excessive tax liabilities, coupled with the new GST rates at 28 per cent, will not only adversely affect the online gaming industry but will also discourage investors from investing in Indian start-ups,” she said.
However, Revenue Secretary Sanjay Malhotra defended the tax notices and clarified that it is not retrospective.
"Certain members had raised the issue of retrospective taxation. It was informed to them that this is not retrospective, and this was the law earlier,” Malhotra told reporters after the council meeting.
“These liabilities already existed because, money online games played with bets...They were already attracting (28 per cent GST) by way of betting or gambling," he added.
Published 07 October 2023, 14:22 IST