There has been a lot of unrest in the Indian gaming industry after the Goods and Service Tax (GST) levied a 28% tax on the full value of online gaming, horse racing and casinos. The new tax law will be applicable to games of skill and chance.
Currently, India has just two gaming companies that are listed on the National Stock Exchange (NSE). One of them is Delta Corp, which is one of the oldest listed companies in the country. Consequently, after the announcement of the 28% GST, the share prices of Delta Corp have seen major fluctuations, with their prices dipping by almost 23%, which is below the standard rates.
Amidst all the chaos, the casinos in Goa and Sikkim have now been accused of tax avoidance worth a significant ₹10,000 Crore by the Directorate General of GST Intelligence (DGGI). Although the institution did not directly name Delta Corp, the casino brand is one of the companies under the radar. Delta Corp owns the Deltin chain of casinos in Goa, including Deltin Royale and Deltin Jaqk, as well as Deltin Denzong in Sikkim.
Interestingly, the yearly revenue of Delta Corp is not more than 1,100 Crore, which means the company does not fall under the said tax slab, and yet the DGGI has made the claims.
#Deltacorp DGGI Should Explains the Logic of Claiming the Tax avoidance of 10000crs when the Yearly Revenue of the Company is not more than 1100 crs .
These DGGI Claim is meant to create Oanic among the Investors and unnecessary harass Companies Directors so that they get… pic.twitter.com/KiKJ0qOK3K
— Chandra Kant Akela (@chandu532) July 21, 2023
As per reports, the DGGI investigations are focused red on two key aspects. This includes “the wrongful payment of GST at a lower rate of 18 percent instead of the mandated 28 percent,” and “the misuse of Input Tax Credit (ITC) through fraudulent claims.”
After DGGI made the claims, the stocks of Delta Corp, the only listed casino gaming company in the country, slid by more than three percent from intra-day highs.
There had been ambiguity surrounding the tax payments by casinos for several years. It was only after the recent 50th GST Council meeting that the tax rate for casinos was fixed at 28%. However, reports suggest that the clarity came in late since DGGI had already started investigating before the decision was made.
Meanwhile, the stocks of Delta Corp, along with six other stocks, were put under the ban for trade on Friday, July 21, 2023, under the futures and options (F&O) segment by the NSE. The reason for this was that these stocks had crossed 95% of the market-wide position limit (MWPL). However, these stocks were available for trading in the cash market.
Amarylisa Gonsalves is a Content Writer at Gutshot Magazine. Advancing from a marketing background, she found her calling in writing. She takes delight in exploring genres and is a curious learner. Patient and ambivert, she believes in letting her work speak for itself. Apart from content writing, she finds solace in writing poetry by expressing herself through words. Additionally, she adores indulging in anything that satisfies her creative self, like drawing and DIY crafts.
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