Goa and Sikkim Casinos under investigation for Rs 10,000 cr tax avoidance

This case has thus led to many ongoing investigations.

The Directorate General of GST Intelligence (DGGI) has shed light on about a dozen casinos operating in Goa as well as Sikkim, alleging an amount of Rs 10,000 crore in tax avoidance by these establishments.

This case has led to many ongoing investigations.

As mentioned by CNBC TV 18, these investigations are primarily focused on two aspects: the inaccurate payment of GST at a rate of 18 percent, much lower than the mandated rate of 28 percent, and the misuse of Input Tax Credit (ITC) through fraudulent claims.

The issue revolving around tax payments by casinos is generated by the lack of clarity in the tax law. Some establishments took advantage of this loophole in the law and remitted GST at a much lower rate of 18 percent.

It was after the 50th GST Council meeting that the tax rate for casinos was clarified and set at 28 percent, which came quite late for multiple casinos already under the DGGI's investigation that had started long before the decision was made.

On the other hand, Revenue Secretary Sanjay Malhotra mentioned to CNBC TV 18 earlier this month that the rate had always been fixed at 28 percent for real money games and that the announcement post the GST Council meeting was merely a clarification.

The prices of Delta Corp slid over 3 percent from the intra-day high on reports of this issue.