The Finance Ministry on Wednesday notified norms to determine the value of supply in case of online gaming and casinos. It has also clarified that the appointed date for implementing norms will be notified later.

Norms are based on recommendations given by GST Council in its meeting on July 18 and August 2. It may be noted that the rate of GST will be 28 per cent on full face value.

What the norms say

According to the notification, the value of the supply of online gaming, including supply of actionable claims involved in online money gaming, shall be the “total amount paid or payable to or deposited with the supplier by way of money or money’s worth, including virtual digital assets, by or on behalf of the player.”

Further, it has been provided that any amount returned or refunded by the supplier to the player for any reason, including the player not using the amount paid or deposited with the supplier for participating in any event, shall not be deductible from the value of the supply of online money gaming.

In terms of casinos, the value of the supply of actionable claims in a casino shall be the total amount paid or payable by the player for buying tokens, chips, coins or tickets. The same will be applicable for the amount paid to participate in any event, including game, scheme, competition or any other activity or process, in the casino, in cases where the token, chips, coins or tickets are not required.

It has been provided that any amount returned or refunded by the casino to the player on return of tokens, coins, chips, or tickets, shall not be deductible from the value of the supply of actionable claims in the casino.

The notification has also made it clear that deployment of winning amount for further play will not be considered part of value of supply for both online gaming and casinos. “Any amount received by the player by winning any event, including game, scheme, competition or any other activity or process, which is used for playing by the said player in a further event without withdrawing, shall not be considered as the amount paid to or deposited with the supplier by or on behalf of the said player,” the notification said.

This means if a player withdraws the winning amount and then goes for a fresh round of gaming or casinos, then that will be treated separate entry and accordingly GST will be levied. In case winning amount not redeployed, then it will be subjected to Income Tax.

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