DGGI sends GST notices to a dozen gaming companies
GST Intelligence (DGGI) has sent out a dozen pre-show cause notices to online real money gaming (RMG) companies over goods and services tax dues of about Rs 55,000 crore, said people with knowledge of the matter. These include a GST notice of about Rs 25,000 crore to fantasy platform Dream 11, possibly the largest indirect tax notice ever served in the country, they said.
With more notices expected in the coming weeks, the total GST demand raised by the DGGI from RMG companies across the country might touch Rs 1 lakh crore, said industry executives.
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Offering CollegeCourseWebsiteIndian School of BusinessISB Digital Marketing and AnalyticsVisitNorthwestern UniversityKellogg Post Graduate Certificate in Digital MarketingVisitNorthwestern UniversityKellogg Post Graduate Certificate in Product ManagementVisitIndian School of BusinessISB Professional Certificate in Digital MarketingVisitIn the GST parlance, an intimation of tax, ascertained as payable through the DRC-01 A form is issued by the authorities. Called a pre-show cause notice, it is issued by the department before it serves a show-cause notice.
Dream11 and Head Digit Works declined to comment on the matter. ET's queries emailed to other companies involved didn’t elicit a response till press time.
The notices were issued after the recent change in GST rates for real money games increased the levy to 28% on the total bet placed at entry level of each gaming session on RMG platforms.
The other companies which have been served the pre-show cause notices include Play Games24x7 Pvt Ltd and its affiliates and Head Digital Works Pvt Ltd, said the people, who did not wish to be identified.
“While Dream11 has been served
