Budget 2023: Higher tax on online gaming
In the Union Budget, TDS on online gaming has been sanctioned. Budget imposes 30 per cent tax on ‘net winnings’ in online gaming. Also, the existing minimum limit of Rs.10,000 has been cancelled. Earlier, TDS was calculated on winnings above the minimum limit.
The proposed measure will ensure that the organizer of the game deducts tax on the entire amount won, irrespective of the amount paid through coupons, tokens or other non-cash payments.
The Union Budget introduced two new rules on tax on online gaming (TDS), including 30 per cent of net winnings on withdrawals and Rs. Minimum win limit above 10,000 has been removed. There is However, in lotteries, crossword puzzle games and other offline games, Rs. 10,000 limit will continue but total winnings will be taxed in the financial year.
In a post-Budget briefing, Revenue Secretary Sanjay Malhotra said that since the nature of online gaming allows a person to play multiple games in a series, net winnings will now be taxed. On the reason for removing the Rs 10,000 cap, Malhotra said some companies kept the winnings below Rs 10,000 to avoid paying TDS.
