Many large companies to move Appellate Authority against GST demand notices
In recent days, an increasing number of GST notices have been sent to many companies mainly on account of alleged discrepancy in input tax credit (ITC).
States have contended that the GST on online gaming companies should not be imposed retrospectively, deliberating on the issue during the GST Council meeting on Saturday, said Maharashtra minister Deepak Vasant Kesarkar.
TS Singh Deo, Chhattisgarh Deputy Chief Minister, said that the Council discussed the issue of retrospectively taxing online gaming under the indirect tax regime.
States pointed out that dues being demanded from some firms is much more than their turnover, he added.
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Post meeting, he said, “There were discussions on charges on these companies retrospectively. Because DGGI is an independent body there cannot be any interference. The chairperson said she would make clarifications available to the DGGI, if required,”
Delhi Finance Minister Atishi Marlena said tax notices are being sent for a much higher amount than even the estimated valuation of the gaming industry.
“From October 1, this 28% GST on online gaming was to be implemented. But tax notices for the last six years calculated at a much higher rate have been sent to online gaming companies,” she highlighted.
It is to be noted that over the past couple of weeks, a host of gaming companies were slapped with show-cause notices.
A lot of them termed this as retrospective taxation since the flurry of notices pertain to the period before the implementation date of October 1, 2023 – the date since the amended law came into place.
GST Council announced the decision to amend the indirect tax law in August. This was done to clarify that all online games involving wagers, irrespective of whether they are based on skill or chance, will attract a GST of 28% on the full value of the bets placed.
On states’ accusations, the central government has so far maintained that the show-cause notices follow a clarification of the law rather than a change and the demand for dues is not retrospective in nature.
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