Composite Rate of Tax - Lottery - Service Tax Practice Manual / Ready Reckoner - Service Tax

Composite Rate / Amount of Tax - Lottery Rule 6(7C) of Service Tax Rules, 1994 The lottery distributor or selling agent has two options to pay service tax for the taxable service of promotion, marketing, organizing or in any other manner assisting in organizing lottery under section 66B and rule 6(7C). OPTION A : under section 66B, pay service tax @ 14% on gross amount of service provided. OPTION B : Composite amount of tax shall as follows: [ rule 6(7C) of Service Tax Rules, 1994] Sl. No. Rate (amount of tax) Condition 1. Rs 8200 on every ₹ 10 Lakh (or part of ₹ 10 Lakh) of aggregate face value of lottery tickets printed by the organising State for a draw If the lottery or lottery scheme is one where the guaranteed prize payout is more than 80% 2. ₹ 12800 on every ₹ 10 Lakh (or part of ₹ 10 Lakh) of aggregate face value of lottery tickets printed by the organising State for a draw If the lottery or lottery scheme is one where the guaranteed prize payout is less than 80% in case of online lottery, the aggregate face value of lottery tickets for the purpose of this sub-rule shall be taken as the aggregate value of tickets sold, and service tax shall be calculated in the manner specified in the said Table. Explanation .- For the purpose of this sub-rule- (ii) draw shall have the meaning assigned to it in clause (d) of the rule 2 of the Lottery (Regulation) Rules, 2010 notified by the Government of India in the Ministry of Home Affairs published in the Gazette of India, Part-II, Section 3, Sub-section (i) vide number G.S.R. 278(E) dated 1st April, 2010. (iii) online lottery shall have the meaning assigned to it in clause (e) of the rule 2 of the Lottery (Regulation) Rules, 2010 notified by the Government of India in the Ministry of Home Affairs published in the Gazette of India, Part-II, Section 3, Sub-section (i) vide number G.S.R. 278(E) dated 1st April, 2010.