- The introduction of Goods and Services Tax aimed to reform the old indirect tax regime, which had issues with the dichotomy and overlap between goods and services resulting in multiple taxation.
- However, the recent Karnataka High Court decision in Gameskraft reveals that foundational issues remain unaddressed, particularly in the classification of online games as games of chance or skill and whether they are subject to GST.
- The exclusion from the scope of GST for actionable claims further complicates the issue. The role of the GST Council is crucial in addressing such disputes and defining GST as a dispute-free tax regime.
- The lag in resolving issues related to taxation of casinos, race courses, and online gaming is not conducive to business sentiments and contradicts the foundational logic of a consumption tax.
- Any post facto guidance or rule changes negatively impact the business’s ability to recover taxes from consumers and translate indirect tax into a tax on the income of the entity.
Source Bqprime
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