INDIAN GAMING STATESIDE
MNS general secretary Manoj Chavan writes to state government to implement Casinos Act
Maharashtra Navnirman Sena (MNS) general secretary Manoj Chavan has addressed a letter to the state government requesting it to formulate a gaming policy for revenue generation and allowing gaming zones in the state. In the letter, Chavan emphasized that allowing
gaming zones will lead to revenue and employment generation in the state. He stated that the neighbouring state of Goa has six offshore and eight onshore casinos which give a boost to its tourism industry, ultimately leading to greater revenue generation. Chavan gave the example of Sikkim stating that
it has a fi ve-star hotel casino while Maharashtra, despite being the most advanced state in the country, falls behind on this front due to its regressive mentality. The MNS general secretary had pressed on this
matter last year in November as well by saying that Maharashtra can also make good use of its coastal belt and set up casinos to make the state a tourist hotspot like Goa. The Maharashtra Casinos (Control and Taxation)
Act, 1976 that was passed on 19th July 1976 is not being implemented according to
Chavan. Rules under the Act are yet to be framed and notifi ed. He also asked about the status of the study group that was formed for visiting Goa,
Macau, Nepal, Sikkim and report back their fi ndings. Chavan also stated that several welfare policies
are facing fund shortages. As a result, the state government cannot afford to ignore the potential of casinos. The MNS general secretary mentioned a study by
American company “Global Market Advisors” which stated that setting up casinos in Maharashtra can generate around $1.1 billion in revenue and with 28% GST levied on the industry, the government can earn $308 million in tax revenue in addition to earning recurring and non-recurring revenues through license fees from casino operators. By setting up tourism, entertainment, hospitality-
related services the state can create massive employment which can put Maharashtra on the global tourism map. Meanwhile, back in 2015, eminent technology and
gaming lawyer Jay Sayta had fi led a PIL in the Bombay High Court on the issue of non-functional Maharashtra Casinos (Control and Taxation) Act, 1976. Sayta submitted, “If the Legislature of the state has
passed a law and the same has received the assent of the Governor, the Executive cannot ignore the intent of the Legislature by not notifying the Act for a very long period, even if it is given the discretion to implement it when it deems fi t. At the very least, the Executive is required to apply its mind as to whether the time has
Online games amount to betting, should pay 28% GST on full value: CBIC chief
Central Board of Indirect Taxes (CBIC) chairman Vivek Johri has said online games characterise gambling or betting and companies are liable to pay GST on the full value at 28 percent, reported CNBC TV18. He said the department has taken this view in the ongoing cases and will wait for the decision of GST Council. These comments are of signifi cant importance as
they provide insight into the department’s view at a time the GST Council is about to decide the long- standing issue. Earlier, in a press briefi ng after the 48th GST
Council meeting in December 2022, the CBIC Chairman stated that online games where winning depends on a specifi c outcome will be subject to 28% GST on the total bet amount. In the budget announcement for 2023-24, the
Finance Minister announced changes in the income tax law applicable to winnings from gaming and gambling. For online games, it is proposed to provide for TDS and taxability on net winnings at the time of withdrawal or at the end of the fi nancial year. This TDS requirement is without any lower applicability threshold and any net winnings from online gaming howsoever small will be subject to 30% TDS deduction. The industry expects
Vivek Johri
the government to settle the ambiguity in indirect taxation as well. Notably, the GST GOM headed by Meghalaya
Chief Minister failed to arrive at consensus after deliberating the matter for over a year. In the earlier meeting, the GST Council postponed the discussion on the matter. Earlier reports also indicated that the GST Council
might categorise actionable claim as ‘services’ by putting it under Section 7 of the CGST Act for taxation purposes without getting into the debate of games of skill or chance. However, the 48th meeting ended without any deliberation on the matter citing the requirement for in-depth discussion.
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www.g2g.news MARCH 2023 27
come for the enforcement of the Act or not, or whether it intends to enforce the Act at all.”
“It is the duty of the High Courts and Supreme
Court to consider cases of non-application of mind and inaction of the government and pass appropriate directions in case the government acts against the letter and spirit of the constitution,” Sayta added. Incidentally, the Federation of Indian Chamber
of Commerce & Industry (FICCI) has estimated that legalizing sports betting will increase the revenue for the government by at least Rs 19,000 crore. “Enforcement of the Casinos Act will help
eliminate the fi nancial woes of the government, as the government will raise thousands of crores in revenues. Further, citizens will not suffer criminal action for an acceptable form of recreation and a legitimate avenue of entertainment,” Sayta explained further. Sayta believed that the enforcement of the
aforementioned legislation would help in curbing illegal activities like match-fi xing as the governmental agencies would be able to monitor betting patterns and take action if needed.
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