GST on Horse racing

[Shashi Kumar]

Horse racing has been clubbed with entertainment at 28%. Turf Clubs have a totalizator system which works on pari-mutuel basis where pooling happens from ppl who bet and from the total revenue collected, a commission is taken out and rest is distributed back to the public. For instance, at Bangalore, for every 100 rupee collected, 12 is taken out as commission and the rest 88 is paid back. If the 12, 8% goes to the state govt as betting tax and 4% is retained by the club. The annual turnover of the Club is around 2000 crores. Will the GST be on the turnover or the commission? The 'service' is costing these Clubs only 12% and not the actual turnover. A similar instance that can be cited here is that while trading Securities (or share trading), the tax is applicable only on the difference between the selling and the buying price and not on the total investment. Thank you.

AI Summary

GST Debate: Should Horse Racing Tax Apply to Total Turnover or Just Club Commissions? A discussion on the Goods and Services Tax (GST) implications for horse racing, specifically whether GST should be applied to the total turnover or just the commission earned by turf clubs. The clubs operate a pari-mutuel system, deducting a commission from bets, with the remainder distributed to bettors. At Bangalore, 12% of the revenue is taken as commission, with 8% going to the state as betting tax and 4% retained by the club. The annual turnover is approximately 2000 crores. The reply suggests GST applies to the total turnover, not just the commission.