Gaming Company Including Dream 11 Is In Problem, Government Asks A Tax Of Rs 55,000 Crore

The Directorate General of GST Intelligence (DGGI) has issued around twelve preliminary notices to online real money gaming (RMG) firms for goods and services tax (GST) liabilities of an approx amount of Rs 55,000 crore. Among these notices, fantasy sports platform Dream11 has received a GST notice exceeding Rs 25,000 crore, which is more or less the largest ever indirect tax notice in India.

Industry executives have informed ET that as more notices are anticipated in the upcoming weeks, the cumulative GST demand raised by DGGI from RMG companies could potentially reach Rs 1 lakh crore. Additionally, it’s worth noting that Dream11 has taken legal action by approaching the Bombay High Court in response to the pre-show cause notice served to them.

These notices were issued after the decision to raise the charge to 28 percent on the total bets placed at the entry level of each gaming session on RMG platforms.

“While Dream11 has been served a pre-show cause of over Rs 25,000 crore on Monday, a similar notice seeking GST dues of Rs 20,000 crore has been issued to Play Games24x7 and its affiliates, including RummyCircle and My11Circle. A pre-show cause notice raising a demand of over Rs 5,000 crore has been served to Head Digital Works,” one of the persons told ET.

“While Dream11 has been served a pre-show cause of over Rs 25,000 crore on Monday, a similar notice seeking GST dues of Rs 20,000 crore has been issued to Play Games24x7 and its affiliates, including RummyCircle and My 11 Circle. In the case of Head Digital Works a pre-show cause notice raising a demand of over Rs 5,000 crore has been served,” another person told ET.

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