The 17th January edition of the Economic Times carried a prominent advertisement, which found its place on this esteemed daily with a different purpose. This ad is a public appeal by The All India Federation of Lotteries Trade and Allied Industries requesting the Prime Minister, Union Finance Minister, state finance ministers and members of the GST Council to lower the discriminatory and arbitrary GST rate of 28% on the face value of lottery authorised by state governments but marketed by private distributors both within and outside the state.

The Public Appeal In The Form Of Advertisement
The Public Appeal In The Form Of Advertisement

The appeal talks of discrimination that the state authorized lottery centers are being subjected to since they are compelled to by 28% GST on the face value of lottery tickets whereas the state run lotteries only pay 12% GST on the face value.

It also says that the imposition of GST on the face value of the tickets is unfair because the majority of the money collected is given back to the winners and only a very nominal amount is retained by the private companies as their commission. It also argues that unlike in India, the various international jurisdictions only impose GST on commission or margin.

Also, the appeal argues that in imposing such high GST on the face value of the lottery tickets is hazardous for the common people as the lottery industry provides employment to more than ten lakh people.

The issuance of such an advertisement was strategic on the part of AIFLTAI as the session of the GST council, a constitutional body of the Union Finance Minister and representatives of all state governments that decides the tax rates, was scheduled for the 18th of January, 2018.

On the other hand, according to an article published by The Indian Express, the central government has already turned down similar appeals by private companies and state governments like Arunachal Pradesh, Mizoram, Goa, Nagaland and Sikkim.

Interestingly, states like Kerela and Punjab have made known to the Central government that the imposition of GST on the lottery tickets have made no change in the selling graph of the tickets and thus in no way has hampered the running of the industry.

However, the private lottery distributers have been protesting against the unified tax regime for quite a few months now, showcasing their disappointment against the system by organizing large public meetings. As per their claims, such system of taxation has dropped their business by over 50-60% since the implementation of the new indirect taxation.

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