GST Goods Rate Notification amended to prescribe uniform 28% GST on lottery

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The CBIC has notified the uniform rate of 28% under GST for the lottery which will be effective from March 1, 2020. Now, there is no distinction for lottery authorized by State Governments and lottery run by State Governments for the purpose of taxability and, hence, the standard rate of 28% shall apply.

In this regard, following amendments are made in Notification No. 1/2017- Central Tax (Rate) dated June 28, 2017 (“Goods Rate Notification”) vide Notification No. 1/2020- Central Tax (Rate) dated February 21, 2020, with effect from March 1, 2020:

Omitted Entry No. 242 of the Schedule II – 6% CGST (i.e. 12% GST):

S.No.

Chapter/Heading/Sub-heading/ Tarif item

Description of Goods

242

Lottery run by State Governments

Explanation 1.- For the purposes of this entry, value of supply of lottery under sub-section (5) of section 15 of the Central Goods and Services Tax Act, 2017 shall be deemed to be 100/112 of the face value of ticket or of the price as notified in the Official Gazette by the organizing State, whichever is higher.

Explanation 2.-

(1) “Lottery run by State Governments” means a lottery not allowed to be sold in any state other than the organizing state.

(2) Organizing state has the same meaning as assigned to it in clause (f) of sub-rule (1) of rule 2 of the Lotteries (Regulation) Rules, 2010.

Substituted Entry No. 228 of the Schedule IV – 14% CGST (i.e. 28% GST):

S.No.

Chapter/Heading/Sub-heading/ Tarif item

Description of Goods

228

Any Chapter

Lottery

Before it was read as:

S.No.

Chapter/Heading/Sub-heading/ Tarif item

Description of Goods

228

Any Chapter

Lottery authorized by State Governments

Explanation 1.- For the purposes of this entry, value of supply of lottery under sub-section (5) of section 15 of the Central Goods and Services Tax Act, 2017 shall be deemed to be 100/128 of the face value of ticket or of the price as notified in the Official Gazette by the organizing State, whichever is higher.

Explanation 2.-

(1) “Lottery authorized by State Governments” means a lottery which is authorized to be sold in State(s) other than the organizing state also.

(2) Organizing state has the same meaning as assigned to it in clause (f) of sub-rule (1) of rule 2 of the Lotteries (Regulation) Rules, 2010″

Similar changes are made to Notification No. 1/ 2017- Union territory Tax (Rate) dated June 28, 2017, vide Notification No. 1/2020- Union Territory Tax (Rate) dated February 21, 2020; and also to Notification No. 1/ 2017- Integrated Tax (Rate) dated June 28, 2017, vide Notification No. 1/2020- Integrated Tax (Rate) dated February 21, 2020.

Read more at:

CGST (Rate) Notification: http://www.cbic.gov.in/resources/htdocs-cbec/gst/notfctn-01-2020-cgst-rate-english.pdf

IGST (Rate) Notification: http://www.cbic.gov.in/resources/htdocs-cbec/gst/notfctn-01-2020-igst-rate-english.pdf

UTGST (Rate) Notification: http://www.cbic.gov.in/resources/htdocs-cbec/gst/notfctn-01-2020-utgst-rate-english.pdf

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