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Why in the News?
The government has proposed a 30 per cent tax on “net winnings” from online games.
What is the proposal?
It also removed the existing minimum threshold limit of Rs 10,000 i.e. the TDS was only applicable if the winning from each game exceeds Rs 10,000.
It will ensure that the game host deducts tax on the entire winnings even if it offers the sum in the form of coupons, tokens, or any other non-cash payments.
However, for lottery and crossword puzzle games, the threshold limit of Rs 10,000 for TDS will continue.
Rationale: some companies were keeping the winnings lower at Rs 10,000, to avoid the TDS provisions.
