Impact Of A Streamlined Lottery Industry On The Job Market & Development In India
By Mohit Sharma, Digital Marketing Manager, Luckykhel
The Indian economy is projected to be the fastest growing major economy in 2018-19 and 2019-20, according to International Monetary Fund October 2018 database. The World Bank has predicted that India’s economy will grow by 7.5% in the year 2019-2020. Defence, agriculture, engineering, banking, insurance,textile and petrochemicals are some of the industries that contribute to this growth. These are the primary sectors that come to mind when one thinks about the nation’s growth. However, there are certain industries that are not acknowledged for their impact on the economy, one such is the lottery industry.
Current Overview: Lottery Industry In India
Still today, at this progressive stage, many people in the country have apprehensions from playing the lottery, and tend not to participate in it. While majority of these people dream or desire to win the lottery jackpot one day! It’s aspirational, achievable but yet unexplored by many. Mainly due to lack of correct information. People need to be made aware of the fact that the lottery is a completely legitimate industry that is supported by the central and the state governments. The states of Maharashtra, Goa, West Bengal, Sikkim, Punjab, Mizoram, Arunachal Pradesh, Assam and Kerala have state-run lotteries. The money that is generated from these lottos only adds to the economy of the states and the country as a whole. Many people might be skeptical about the amount of money that the lottery can generate. The All India Federation of Lottery Trade & Allied Industries (AIFLTAI) has provided data which shows that these nine states have collected INR 3,948 crore in merely nine months after the 2017 GST roll out. One can only imagine how much this amount will multiply by if the lottery is legalised in other states as well. Industry experts have estimated that this could garner a revenue of 50,000 crore per year.
GST Rates On Lottery
The method of collecting this money is different in various parts of the country. As per the current GST rates for the lottery industry, a state-run lottery attracts a GST of 12% while a state-authorised lottery attracts a GST of 28%. The difference between these two lotteries is something that needs to be made crystal clear. A state run lottery is the lottery that is carried out by one of the nine states in which the lottery is legalised. On the other hand, a state authorised lottery is one that your state allows you to participate in, even though you may not be a resident of that state. For example, if a resident of Goa is taking part in Goa’s lottery, it is known as a state run lottery. This person will be charged a GST of 12% for participating in the lottery. If, however, there was a lottery that was being run in Maharashtra and the same resident of Goa was taking part in it, the GST rates would be different. For participating in the Maharashtra lottery, this resident of Goa would be taxed with a GST of 28%. The sole reason for this is because he has participated in a state-authorised lottery.
Many organizations, people, leaders and also active lottery players feel that the tax on state-authorised lottery is too high, and this rate needs immediate revision. Also the different states of the country are divided about if this current system of differentiated rates should be continued with or if a uniform rate should be decided for the entire country. The GST Council has constituted a Group of Ministers (GoM)with eight-members, to come up with a verdict about the issue. These ministers are headed by the Maharashtra’s Finance Minister Sudhir Mungantiwar. They have to decide if the uniform GST rate of the lottery will be 18% or 28% throughout the country. This GoM has also been given the responsibility of enforcing a legal framework for the lottery in India.
How Streamlining The Lottery Industry Can Help
If a uniform rate is decided upon by this council, there will be numerous benefits for the Indian economy. A uniform rate could lead to more states joining in which will lead to public welfareand revenue generation in multiple ways. This money can be pumped into the universal healthcare scheme within the country, Ayushman Bharat. The All India Federation of Lottery Trade & Allied Industries (AIFLTAI) informed about the idea of lotteries supporting the healthcare in the country to NITI Aayog last September.
The Ayushman Bharat – Pradhan Mantri Jan Arogya Yojana (AB-PMJAY) is touted to be the largest government funded healthcare programme in the world which is expected to have more than 50 crore beneficiaries. It aims to reduce the expenditure that people have to undergo when they have medical treatment.
Additionally, we have seen that a number of Ivy League universities across the world have been funded by money that has been generated through the lottery. The same can be done to run India’s prestigious universities and take them to new heights. The funds can also be used to help in emergency situations like earthquakes or tsunamis. This is something that Sri Lanka had done to rehabilitate its tsunami victims in the year 2005. The Indian sports industry can also benefit from the lottery. Nation’s across the world like the UK have used their national lottery money to develop and enhance the sports industry. India, too, can use this money to popularise the lesser known sports within the country and to further strengthen the national teams. Along, with these, experts have also envisioned that correct use of revenue from the lottery industry can be strategically used to create lakhs of jobs in India, due to the development of various sectors. Also, streamlining of the lottery within the country will also generate more jobs within the lottery industry itself.
Need For GST Rate Revision
But many people who play lottery are worried about the high tax rate on state-authorised lotteries. Many lottery retailers have objected to high taxation, as their businesses are gaining barely any profits, which has given rise to illegal lottery schemes across the country. The government and the police have been busting such practices regularly. Bringing down the high taxation rate, will encourage more players as well as more retailers to run legitimate lottery businesses. Which is likely to expand and increase revenues of the lottery industry overtime. Streamlining the lottery industry within the nation could impact all the above sectors in a positive manner. People should look at it as something that has the potential to create a long lasting positive impact upon the nation.
Author: Stoodnt Guest Author
Stoodnt Guest Author are experts, professors, teachers, tutors and professionals who want to share their advice, insights and guidance to students, young professionals and others.
Internships are a gateway to the real professional world. They provide you with the experience and exposure to understand the intricacies and different aspects of…Read More
By Santosh Sharma, Visiting Faculty, IIM Ranchi & Jain University, Author of Dissolve the Box When the Going gets tough, the tough gets…Read More
Application forms for one of the most prestigious and top entrance exams of India after Class 12, BITSAT 2019 are out. BITSAT (BITS Admission Test)…Read More
By Saikiran Sondarkar, EA to Chairman, Special Initiatives, ITM Group of Institutions As Blockchain is termed as the greatest inventions in 21th Century, it is…Read More