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Lottery companies refute charges of GST evasion

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Lottery industry crippled by GST

One day after it was reported that the central GST authorities in Punjab investigated four major lottery companies in the country, the Times of India in a follow-up story has reported that lottery companies have refuted the allegations leveled against them and have claimed that only 12% GST is applicable on lottery tickets sold in the same state where it originates, irrespective of whether it is marketed by private distributors or not.

Roop Singh, general manager of Sugal & Damani owned M/s. Skill Lotto said, “Ever since the implementation of GST, we have been paying tax as per rules, according to which licensees authorized by the Punjab government for sale of its lotteries are liable to charge and pay 12% GST if they sell them within Punjab, and 28% if they sell them in other states. But CGST department wants us to pay 28% in all cases, which is unjustified as there is no such rule, and even the Department of Lotteries, Punjab, is of the view that we are liable to pay only 12%.”

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Martin Group officials also claimed that the tax department had wrongly made them liable for 28% GST. Prem Raj Bamboli, sales head of Future Gaming and Hotel Services Pvt. Ltd. noted, “GST of 28% is applicable if we sell lotteries of other state governments in Punjab or lotteries of Punjab government in other states.”

Suresh Arora, Vice President (Sales) of Essel Group’s E-Cool Gaming Solutions Pvt. Ltd. also supported these contentions and told Times of India, “We have been paying our taxes as per law, and at the rate of 12% for sale of Punjab State Lotteries within Punjab. We have not flouted any norms. Moreover, the Rs. 50 lakhs deposited by us at the time of search was not any kind of penalty or differential tax, but pending GST, which was due during that period when the department was conducting the investigation.”

Jay has researched extensively on gaming laws and has been cited by various media houses and journals as an expert. He has helped leading newspapers in their stories on gaming laws. Jay completed his B.A. LL.B. (Hons.) degree from NUJS, Kolkata in 2015 and is currently based out of Mumbai.

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