Tax on online gaming is charged on GGR/comission received. However it has been proposed by GoM that the same shall be taxed on full contest amount.
A gaming company receives Rs. 100 from its customers in total. The company gives away winning amounts to the tune of Rs. 70 to these customers. Currently GST was being charged on the Balance Rs. 30 (Gross Gaming Revenue). However, as per the proposal of the GoM, GST shall be charged on Rs. 100 (Amount Wagered).
The proposal shall be placed in 47th Council meeting. If such a proposal is accepted, platform owners will have to shell out approx. 6 to 10 times more GST as against what they are currently paying.