71 notices sent to online gaming firms for GST of Rs 1.12 lakh crore: MoS Finance in RS

As many as 71 show-cause notices have been issued to online gaming companies during the financial year 2022-23 and 2023-24 (up to October 2023) involving goods and services tax to the tune of Rs 1,12,332 crore. 

The information as provided by minister of state for finance Pankaj Chaudhary in response to a question on tax evasion by Rajya Sabha MP Sushil Kumar Modi in Rajya Sabha on Tuesday.  

“As these notices are pending adjudication, the respective GST demand is not yet determined under the provisions of CGST Act, 2017,” Chaudhary said. No overseas online gaming companies registered in the country since October, he further said. 

His comments come in the backdrop of the levy of 28% GST on online gaming companies from October 1. Under the rules, overseas gaming firms who operate in India have to register in the country for payment of GST. The Directorate General of GST Investigation has also cracked down on many firms for payment of past dues. Notices have been issued to firms including Dream11 and Games24x7 while a case is also ongoing in the Supreme Court over Rs 21,000 crore GST notice to Gameskraft. 

Meanwhile, tax authorities have detected GST evasion of Rs 1.51 lakh crore between April to October 2023 and has recovered Rs 18,541.38 crore and arrested 154 persons with regard to evasion.  

In all, tax authorities have detected GST evasion of Rs 4.46 lakh crore between FY20 to FY24 (till October 2023) of which Rs 1.07 lakh crore have been recovered and realised. 

Meanwhile, in response to another question, Finance Minister Nirmala Sitharaman said that a total of 21,791 entities having GST registration were discovered to be non-existent involving Rs 24,010 crore of suspected tax evasion during the special drive on fake registrations. 

This included 11,392 entities pertaining to state tax jurisdiction involving an amount of Rs 8,805 crore and 10,399 entities pertaining to CBIC jurisdiction with Rs 15,205 crore of suspected tax evasion.

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