Delta Corp shares slumped 4% on Tuesday after the introduction of a 28% Goods and Services Tax (GST) on online gaming.
The company’s shares closed at ₹136.90, down 4.06%. This change in taxation came into effect on October 1, following the closure of markets on October 2 for Mahatma Gandhi Jayanti.
New Taxation on Online Gaming
Under amendments to the Central GST Act, online gaming, casinos, and horse racing are now categorized as ‘actionable claims,’ akin to lotteries, betting, and gambling, subject to a 28% GST.
Foreign Platforms Required to Register and Pay GST
The Integrated GST (IGST) law has been amended to make it compulsory for foreign online gaming platforms to register in India and adhere to domestic tax laws, including the 28% GST rate.
Approval Granted in July
In July and August, the GST Council, composed of Finance Ministers from both the Center and States, approved these legislative changes, making online gaming, casinos, and horse racing taxable.
They clarified that the tax rate would be 28% on the entire stake value. Parliament subsequently passed amendments to the Central GST and Integrated GST laws to implement the Council’s decision.
Tax Dues Notice Issued
Delta Corp recently received a tax notice for ₹16,822 crore for the period from July 2017 to March 2022.
The notice also includes a ₹5,682 crore demand against three of its subsidiaries: Casino Deltin Denzong, Highstreet Cruises, and Delta Pleasure Cruises.
The company stated that it received a notice for ₹11,140 crore, including interest and penalties, for the same period.
