Delta Corp shares soar on reports of potential GST waiver
Shares of online gaming company Delta Corp, hit a five-month high on Wednesday, following reports that the GST Council may consider an amendment to the CGST Act. This amendment could potentially dismiss retrospective tax demands, a move that the gaming industry has been advocating for. At 3:00pm, Delta Corp shares had risen over 11%, while Nazara Tech also experienced an early trade share price spike. In the past month, Delta Corp's shares have risen 23%, while Nazara's have surged 40%.
Challenging retrospective GST notices
The CGST Act includes provisions for notices, in cases where e-gaming entities paid lower taxes due to ambiguity/interpretation issues related to the law. The GST Council might discuss a recommendation to amend the Act at its upcoming meeting on June 22. Currently, there are 30 petitions by online real money gaming companies which are challenging retrospective GST notices seeking thousands of crores in dues. This is calculated at 28% on face value of bets pending before the Supreme Court.
Online gaming industry seeks tax reduction
The online gaming industry has expressed intentions to approach the new government, to seek a reduction in Goods and Services Tax (GST). They propose that tax be computed on Gross Gaming Revenue (GGR) instead of full face value. Unnamed industry players have said this proposal is based on their belief that the current high tax rate is unsustainable for start-ups in this sector.
