India’s version of the IRS, the GST Council, had bombarded the country’s casinos, racing institutions and online gaming companies with demands to pay a total of $12 billion in unpaid goods and services (GST) taxes, all for fiscal year 2018, the financial publication Mint reported October 30.
Mint’s source was a government official, who conceded its efforts to collect will depend on how courts throughout the country rule on the attempt.
The GST Council recently imposed a 28 percent tax on the total value of casino chips purchased, deposits made or wagers placed, rather than on gross revenues for casinos, online gambling and horse racing.
As an example, Delta Corp was sent GST demands totaling more than six times its market cap, a total of $2.8 billion. A court has issued a stay on the matter.
Another official told Mint that Gameskraft Technologies Pvt Ltd. had gotten a favorable order that is under appeal by the government and is before the Supreme Court.
Delta Corp argues that the GST demands are unconstitutional.
“Demand of GST on gross bet value, rather than gross gaming revenue, has been an industry issue and various representations have already been made to the Government at an industry level in relation to this issue,” said Delta in a statement, adding, “The Company has been legally advised that the DG Notice and the tax demand is arbitrary and contrary to law, and the Company will pursue all legal remedies available to it to challenge such tax demand and related proceedings.”
