Online Gaming: Maharashtra Passes GST Amendment Act

To give effect to 28% GST on online gaming, the Maharashtra Goods and Services Tax (Second Amendment) Act, 2023, has been passed by the State Legislature. It replaces the ordinance promulgated by the Governor on September 26, 2023.

Entry 6 of Schedule III of the 2017 Act is modified to bring “specified actionable claims”, which refers to “actionable claim involved in or by way of,— (i) betting; (ii) casinos; (iii) gambling; (iv) horse racing; (v) lottery; or (vi) online money gaming“, within the purview of supply.

In August 2023, the Parliament amended the GST laws and a tax of 28% was levied on the full face value of bets in online gaming, casinos and horse race clubs. In the subsequent month, the methodology to compute the value of online gaming supply was notified by the Central Board of Indirect Taxes and Customs (CBIC). 

Though states are passing amendments to implement the 28% GST on online gaming, certain online gaming companies have challenged the constitutional validity of such levy, and the Supreme Court has sought the Centre’s response.[1] This matter will be heard next on April 2, 2024.

[1] M/s. E-Gaming Federation & Anr. v. Union of India & Ors. [WP(C) No.1384/2023]