CGST and IGST Amendment Bills, 2023 introduced in the Lok Sabha today

The Hon’ble Finance Minister Nirmala Sitharaman today i.e. August 11, 2023, introduced The Central Goods and Services Tax (Amendment) Bill, 2023 and the Integrated Goods and Services Tax (Amendment) Bill, 2023 to amend the Central GST law and Integrated GST law to levy 28 per cent tax on the full face value of bets in online gaming, casinos and horse race clubs.

Excerpts of The Central Goods and Services Tax (Amendment) Bill, 2023

THE CENTRAL GOODS AND SERVICES TAX (AMENDMENT) BILL, 2023

1. Short title and commencement. (1) This Act may be called the Central Goods and Services Tax (Amendment) Act, 2023.

(2) It shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint:

Provided that different dates may be appointed for different provisions of this Act and any reference in any such provision to the commencement of this Act shall be construed as a reference to the coming into force of that provision.

2. Amendment of section 2. In section 2 of the Central Goods and Services Tax Act, 2017 (hereinafter referred to as the principal Act),-

(a) after clause (80), the following clauses shall be inserted, namely:-

‘(80A) "online gaming" means offering of a game on the internet or an electronic network and includes online money gaming;

(80B) "online money gaming" means online gaming in which players pay or deposit money or money’s worth, including virtual digital assets, in the expectation of winning money or money’s worth, including virtual digital assets, in any event including game, scheme, competition or any other activity or process, whether or not its outcome or performance is based on skill, chance or both and whether the same is permissible or otherwise under any other law for the time being in force;’;

(b) after clause (102), the following clause shall be inserted, namely:-

‘(102A) "specified actionable claim" means the actionable claim involved in or by way of-
(i) betting;
(ii) casinos;
(iii) gambling;
(iv) horse racing;
(v) lottery; or
(vi) online money gaming;’;

(c) in clause (105), the following proviso shall be inserted at the end, namely:-

"Provided that a person who organises or arranges, directly or indirectly, supply of specified actionable claims, including a person who owns, operates or manages digital or electronic platform for such supply, shall be deemed to be a supplier of such actionable claims, whether such actionable claims are supplied by him or through him and whether consideration in money or money’s worth, including virtual digital assets, for supply of such actionable claims is paid or conveyed to him or through him or placed at his disposal in any manner, and all the provisions of this Act shall apply to such supplier of specified actionable claims, as if he is the supplier liable to pay the tax in relation to the supply of such actionable claims;";

(d) after clause (117), the following clause shall be inserted, namely:-

‘(117A) "virtual digital asset" shall have the same meaning as assigned to it in clause (47A) of section 2 of the Income-tax Act, 1961 ;’.

3. Amendment of section 24. In section 24 of the principal Act,-

(a) in clause (xi), the word "and" ocurring at the end, shall be omitted;

(b) after clause (xi), the following clause shall be inserted, namely:-

"(xia) every person supplying online money gaming from a place outside India to a person in India; and".

4. Amendment of Schedule III. In the principal Act, in Schedule III, in paragraph 6, for the words "lottery, betting and gambling" the words "specified actionable claims" shall be substituted.

5. Transitory provision. The amendments made under this Act shall be without prejudice to provisions of any other law for the time being in force, providing for prohibiting, restricting or regulating betting, casino, gambling, horse racing, lottery or online gaming.

Excerpts of the Integrated Goods and Services Tax (Amendment) Bill, 2023

THE INTEGRATED GOODS AND SERVICES TAX (AMENDMENT) BILL, 2023

1. Short title and commencement (1) This Act may be called the Integrated Goods and Services Tax (Amendment) Act, 2023.

(2) It shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint.

2. Amendment of section 2. In section 2 of the Integrated Goods and Services Tax Act, 2017 (hereinafter referred to as the principal Act), in clause (17), for sub-clause (vii), the following sub-clause shall be substituted, namely:-

"(vii) online gaming, excluding the online money gaming as defined in clause (80B) of section 2 of the Central Goods and Services Tax Act, 2017;"

3. Amendment of section 5. In section 5 of the principal Act, in sub-section (1), in the proviso, after the words "integrated tax on goods" the words "other than the goods as may be notified by the Government on the recommendations of the Council" shall be inserted.

4. Amendment of section 10. In section 10 of the principal Act, in sub-section (1), after clause (c), the following clause shall be inserted, namely:-

"(ca) where the supply of goods is made to a person other than a registered person, the place of supply shall, notwithstanding anything contrary contained in clause (a) or clause (c), be the location as per the address of the said person recorded in the invoice issued in respect of the said supply and the location of the supplier where the address of the said person is not recorded in the invoice.

Explanation.-For the purposes of this clause, recording of the name of the State of the said person in the invoice shall be deemed to be the recording of the address of the said person;".

5. Insertion of new section 14A. After section 14 of the principal Act, the following section shall be inserted, namely:-

"14A. Special provision for specified actionable claims supplied by a person located outside the taxable territory. (1) A supplier of online money gaming as defined in clause (80B) of section 2 of the Central Goods and Service Tax Act, 2017, not located in the taxable territory, shall in respect of the supply of online money gaming by him to a person in the taxable territory, be liable to pay integrated tax on such supply.

(2) For the purposes of complying with provisions of sub section (1), the supplier of online money gaming shall obtain a single registration under the Simplified Registration Scheme referred to in sub-section (2) of section 14 of this Act:

Provided that any person located in the taxable territory representing such supplier for any purpose in the taxable territory shall get registered and pay the integrated tax on behalf of the supplier:

Provided further that if such supplier does not have a physical presence or does not have a representative for any purpose in the taxable territory, he shall appoint a person in the taxable territory for the purpose of paying integrated tax and such person shall be liable for payment of such tax.

(3) In case of failure to comply with provisions of sub section (1) or sub section (2) by the supplier of the online money gaming or a person appointed by such supplier or both, notwithstanding anything contained in section 69A of the Information Technology Act, 2000, any information generated, transmitted, received or hosted in any computer resource used for supply of online money gaming by such supplier shall be liable to be blocked for access by the public in such manner as specified in the said Act.".