As per the latest news reports, the Central Board of Direct Taxes (CBDT) is looking into online gaming wins to the tune of ₹58,000 Crore. The media reports state how the CBDT is scrutinizing an online gaming brand under the CBDT lens for prizes won on its platform over the last three years. The news reports also state that the Income Tax department has urged online gamers to come forward and disclose their income via online games and file updated income tax returns (ITR-U) and pay taxes which are applicable as per law.
News reports reveal that officials have asked online gamers to file taxes on undeclared winnings for the assessment years of 2019 – 2020 and 2020 – 2021. Nitin Gupta, Chairman, Central Board of Direct Taxes, told The Indian Express, “Some may have earned more and some less…They are usually in a ledger account and they merge win and loss, it (data) is humongous.”
As per the news report, over 20,000 taxpayers have filed updated returns for both years 2020 – 2021 and 2021 – 2022 as of 2nd September; the undeclared tax payments are reportedly valued at over ₹50 Crore. Gupta in an interview with ET Now said, “Have issued ₹95,000 crore returns in this fiscal which is 78% higher than previous year in corresponding period.” The media report states that a new module has been put in place on the income tax portal. This means gamers will have to pay an extra 25% on past winnings in terms of taxes not paid.
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According to news reports, CBDT expects to exceed the ₹14.2 Lakh Crore mark of the budgeted target for FY23. The CBDT Chairman also spoke about ways to stop tax evasion in areas of foreign income sources, asset reconstruction, online gaming, and betting. Gupta also added that the income tax law stipulates 30% tax and a surcharge on winnings from online gaming and betting.
In other news, online gaming operators in India are relieved after the Group of Ministers (GoM) decided that online gaming will be categorized separately from horse racing and gambling when it came to imposing taxes. In July 2022, the Goods and Services Tax (GST) Council made a decision to raise the tax on online gaming from 18% to 28%. At the present time, an 18% GST is applicable on gross gaming revenue (GGR).
With a Masters Degree in Journalism and Communication, Mrinal Gujare currently is cruising through an exciting genre of writing and editing at Gutshot Magazine. Apart from being an Editor, Mrinal is an avid reader and a former contemporary dancer. She is also perennially hungry for intriguing scoops from across the globe. No holds barred is the rule Mrinal follows in life.
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