Indian Lottery Taxes

Lottery Taxes in India – 2 Different Types

Taxes aren’t the best but a necessary part of a functioning society and lottery taxes are not an exception.

In India taxes on lotteries are divided into two different categories.

First, you have the taxes that lottery providers have to pay.

Lottery providers are:

  • Government Lotteries
  • Lottery Agents
  • Lotto Bookkeepers
  • Lottery Resellers

The second tax is the one you are interested in learning about, the player tax.

In this article, you can learn more about both the different lottery taxes in India and how they apply to you.

Current Lottery Provider Tax Laws

After long discussions, a favourable outcome on tax has reached Indian lotteries. On December 18, 2019, the Good and Service Tax council decided to make a new fixed tax on all lotteries available in India.

The Indian lottery taxes will be updated on March 1 in 2020. All lotteries both private and state will get a fixed uniform tax rate of 28%.

This makes it easier than ever to enjoy the best international online lotteries from India!

Tax on Lottery Winnings in India

The Indian government has decided that any gambling wins count as an income source. Therefore you will have to pay taxes on any of your lottery wins.

If you win on a lottery in India, online or government, you will have to file your earnings as “Income From Other Sources” when filing your returns for paying income tax each year.

All gambling wins come under the category of special incomes under the Indian Tax Law.

Under Section 194B of the Income Tax Act, 30% tax is deducted on any lottery winnings above Rs 10,000. 

So if you win a jackpot of Rs. 10 crores you will receive Rs. 7 crores and the government will take Rs. 3 crores. 

Previous Lottery Provider Tax Laws

Indian lottery distributors reached out to government officials with hopes of being able to reduce the current Goods and Services Tax (GST). This tax applies to both national and state lotteries.

Before 1st of March 2020, all lottery distributors have to obey a strict 28% tax on the face value of all lottery tickets and a 12% tax on the face value of lottery tickets sold by state governments.

Several industry analysts have stepped forward and claimed that this tax is having a severe impact on sales. It is reported that as much as 70% of sales may have been lost as a direct effect of the current tax structure.

This is one of the reasons the Indian government changed to the 28% flat rate.

🏅Lottery Taxes in India

🏵 Do I have to pay taxes on my lottery winnings?

Yes, there is a flat rate of 30% tax applied to all lottery wins but there are exceptions that allow you to avoid paying taxes.

🏵 Do government and international lotteries have to pay taxes in India?

Yes, just like you have to pay taxes so do also lottery providers. Since March 1, 2020, all lotteries pay 28% tax.

🏵 Why do you need to pay lottery taxes?

The Indian government sees a lottery win as any other source of income and therefore you need pay taxes.

🏵 Do I have to pay tax on online lotteries?

Yes, all lottery wins in India are covered by the same 30% flat rate. But there are some exceptions that are tax-free.