The 51st meeting of GST Council was held on 2nd August, 2023 with the main agenda of taxing online gaming and actionable claims. The GST Council recommended certain amendments in the CGST Act 2017 and IGST Act 2017, including amendment in Schedule III of CGST Act, 2017, to provide clarity on the taxation of supplies in casinos, horse racing and online gaming. The Council
also recommended to insert a specific provision in IGST Act, 2017 to provide for liability to pay GST on the supply of online money gaming by a supplier located outside India to a person in India, for single registration in India for the said supplier through a simplified registration scheme and also for blocking of access by the public to any information generated, transmitted, received or hosted in any computer resource used for supply of online money gaming by such supplier in case of failure to comply with provisions of registration and payment of tax. It was also decided by the Council that effort will be made to complete the process of making amendments in the Act at the earliest and bring the amendments into effect from 1st October 2023.
Finance Minister has introduced CGST Act (Amendment) Bill, 2023 and IGST Act (Amendment) Bill 2023 in the Parliament on 11th August, 2023 to implement decisions of GST Council to levy 28% tax on online gaming. Lok Sabha has passed both the Bills on 11.08.2023, same day itself. This will come into effect from a notified date. It provides for defining online gaming, registration and change in scope of supply (Schedule III) etc. Similar changes are stipulated in IGST Act, 2017. It is expected that all the states will also make the necessary amendments in state GST laws in next two months in the ongoing monsoon sessions or by way of as Ordinance on online gaming. It is expected to raise about Rs. 2000 crore of tax revenue which is expected to be levied from 1st October, 2023.
After bunch of Circulars, CBIC has issued a series of rate Notifications and other Notifications, i.e., Notification Nos. 6 to 10 (Rate) dated 26.07.2023 and Central Tax Notification Nos. 27 to 35, all dated 31.07.2023 and IGST Notification No. 1/2023-IGSTdated 31.07.2023. These pertain to rate changes, exemptions and GTA services. Compensation Cess on various tobacco products and utility vehicles have also been prescribed. Others relate to Rule 4A non-applicability to Puducherry, turnover based exemption to filing of annual return, account aggregators, exemption to e-commerce operators from registration and adjudication powers. Special procedure has also been prescribed to be followed by registered persons engaged in manufacturing of certain goods and for registered persons as per directions of Supreme Court in Filco Trade Centre case (Transition Credit). Also, provisions of section 137 to 162 of Finance Act, 2023 have been notified for enforcement.
Further new notifications, viz Notification Nos. 36 to 38, all dated 04.08.2023 have been issued to implement decisions of GST Council. These relate to prescribing special procedure to be followed by e-commerce operators in respect of supplies of goods through them by dealers under composition scheme, special procedure to be followed by e-commerce operator in respect of supplies of goods through them by unregistered persons and amendment in CGST rules. Few CGST Rules have been amended in relation to returns, registration, physical verification of business premises, manner of dealing with difference in input tax credit (ITC) between GSTR-2B and GSTR-3B, intimation of certain amounts liable to be recovered u/s 79, consent based sharing of information etc.
In one of the answers to questions in Parliament, Finance Minister has revealed that 2784 cases of GST evasion were detected in April – May 2023 involving Rs. 14302 crore of tax. There were 28 arrests in 2022-23, 15602 GST evasion cases amounted to Rs. 131613/- crore and recovery of Rs. 33226 crore. The Government has unleashed many measures to plug the problem of tax evasion including risk parameter based tracking and use of artificial intelligence.
W.e.f. 1st August 2023, e-invoices have been made mandatory for smaller taxpayers whose aggregate annual turnover has exceeded Rs. 5 crore during any financial year from 2017 onwards w.e.f. 01.08.2023, the threshold turnover shall be Rs. 5 crore (Rs. 10 crore).
GST Collection for the month of July, 2023 is Rs. 1655105 crore with a 11% YoY growth. The tax collection has crossed Rs. 1.6 lakh crore for the 5th time since July, 2017. The revenues for the month of July 2023 are 11% higher than the GST revenues in the same month last year. During the month, the revenues from domestic transactions (including import of services) are 15% higher than the revenues from these sources during the same month last year. It is for the fifth time, the gross GST collection has crossed Rs. 1.60 lakh crore mark.
Mr. Sanjay Agarwal, IRS, has been appointed as new Chairman of CBIC on 5th August, 2023.
Author Bio
Sir,
What will happen to the game of Rummy, for which GST demand running into Many thousand crores was raised, which was decided in favour of party by the Karnataka HC on 11.5.2023 :Gameskraft Technologies Pvt. Ltd. & Ors v. Directorate General of GST Intelligence (2023) 40 J.K.Jain’s GST & VR 1. In My view that Judgment will prevail since no retrospective amendments can be made by the Govt. in the definition clause introduced by way of CGST amendment Bill.
Ca Om Prakash Jain s/o J.K.Jain, Jaipur
Tel 9414300730/0141-3584043