Notification No. 01/2020 – Central Tax (Rate) Explained

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Notification No. 01/2020 - Central Tax (Rate): Seeks to amend notification No. 1/2017- Central Tax (Rate) dated 28.06.2017 so as to notify rate of GST on supply of lottery.

GST: [TO BE PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINARY, PART II, SECTION 3, SUB-SECTION (i)]

G.S.R. (E).- In exercise of the powers conferred by sub-section (1) of section 9 and sub-section (5) of section 15 of the Central Goods and Services Tax Act, 2017 (12 of 2017), the Central Government, on the recommendations of the Council, hereby makes the following further amendments in the notification of the Government of India in the Ministry of Finance (Department of Revenue), No.1/2017-Central Tax (Rate), dated the 28^th June, 2017, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 673(E), dated the 28^th June, 2017, namely:-

In the said notification, -

in Schedule II - 6%, S. No. 242 and the entries relating thereto shall be omitted;

in Schedule IV - 14%, for S. No. 228 and the entries relating thereto, the following S. No. and the entries shall be substituted, namely: -

“228.

Any chapter

Lottery”.

2. This notification shall come into force on the 1^st day of March, 2020.

(Pramod Kumar)
Director to the
Government of India

Note: - The principal notification No.1/2017-Central Tax (Rate), dated the 28^th June, 2017 was published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 673(E), dated the 28^th June, 2017 and last amended by Notification No. 27/2019-Central Tax(Rate) dated 30^th December, 2019 published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) vide number G.S.R. 961(E), dated the 30^th December, 2019.

📚 Frequently Asked Questions (FAQs): Notification No. 01/2020 – Central Tax (Rate)

Q1: What is Notification No. 01/2020 – Central Tax (Rate)?

Answer:
It sets a uniform 28% GST on all types of lotteries in India.

Q2: From when does the new rate apply?

Answer:
Applicable from 1 March 2020.

Q3: Is 28% rate applied on face value of ticket?

Answer:
Yes. GST is calculated on the transaction value.

Q4: Does this apply to both State and private lotteries?

Answer:
Yes — all lotteries are treated equally.

Q5: Is compensation cess applicable?

Answer:
No — only 28% GST.

Q6: What if old rate (12%) was charged by mistake?

Answer:
A debit note must be issued → pay differential tax.

Q7: Who pays GST on lottery – distributor or organizer?

Answer:
Depends on commercial arrangement, but tax must be deposited by authorized taxable person.

Q8: Can ITC be claimed?

Answer:
Yes, if the distributor is making taxable supplies and ITC is eligible under law.

Q9: Is selling lottery considered goods or services?

Answer:
Lottery is treated as goods under GST.

Q10: How is GST paid in case of prize-in-kind?

Answer:
Tax is paid on base ticket value, not on prize.

Q11: What about online lottery ticket sale?

Answer:
Tax still applies @ 28%, whether offline or online.

Q12: Are lottery agents required to register under GST?

Answer:
Yes — if turnover exceeds threshold.
👉 https://finodha.in/online-gst-registration/

Q13: Does this impact profit margin of operators?

Answer:
Yes — higher tax reduces margin unless price is increased.

Q14: Are cross-state sales taxed differently?

Answer:
IGST applies at 28% for interstate supplies.

Q15: Do lotteries still come under gambling in law?

Answer:
Regulated under Lotteries (Regulation) Act, 1998 + taxed under GST.

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