AS per recent clarification issued through circular, regarding levy of GST on speculation services, there are certain issues which are discussed below:
Betting & Gambling in Casinos
Since the method of determining taxable amount for casino were not stated in value of Supply rule. Casino operator were considering services provided by them as mixed supply and they were charging GST @ 28% on the gross amount collected as admission charges to the casino or entry fees.
Central govt. has clarified that “entry to casinos” and “gambling” are two different services. Taxable value or Value of supply will be determined as per section 15 of the CGST Act.
GST will be levied at 28% (14% CGST and 14% SGST) on the full value of Supply of following services:
- Entry fees to Casinos
- Gambling or Betting Value
GST would be leviable on total bet value. Services supplied by way of supply of food/drinks will be charged separately and GST would levy at respective rates.
The tax base to levy GST on horse racing was not specified before, now it has been clarified that GST would be leviable on the entire bet value i.e., total of face value of any or all bets paid into the totalisator or placed with licensed book makers, as the case may be.
Totalisator: a device showing the number and amount of bets staked on a race, to facilitate the division of the total among those backing the winner.
Licensed Bookmaker: A bookmaker, bookie or turf accountant is an organization or person that accepts and pays off debt on sporting and other events at agreed- upon odds.
Illustration: If entire bet value is Rs. 100, GST would be levied at 28%. i.e., Rs. 28