Fate of West Bengal state lottery uncertain as threat of GST hike looms large

Kolkata: West Bengal State Lottery has received a severe blow due to a steep rise in the Goods and Services Tax (GST), forcing the lottery ticket sellers and agents to close down their business from March 1.

It happened after the Centre increased GST from 12 to 28 percent on the lottery. The new rate has been implemented from March 1. The sellers and agents are facing a huge loss following the decision. According to lottery sellers, they are no longer ready to continue the business as it will impose more financial burden on them.

The state government had made a profit of Rs 223 crore in the last financial year. According to the officials at the state Finance department, the stepmotherly attitude by the Narendra Modi government has put the lottery business in jeopardy.

The state government may formulate a new policy to revive the lottery business which is now in dire straits, sources in the Finance department said.

The officials are, however, yet to mention the date when the business will be resumed. It has been learnt that state government provides 30 percent commission to the agents. Out of this, the agents used to pay 12 percent as GST.

But now, the agents have to pay a huge amount of money as GST, which according to them is not commercially viable. For example, earlier the agents used to get Rs 300 if they withdrew lottery worth Rs 1,000.

Out of the commission, the agents used to pay Rs 120 as GST, while the remaining Rs 180 had been their profit margin. Following the implementation of the hiked GST rate, the agents now have to pay Rs 280 if they withdraw lottery worth Rs 1,000.

Many of the agents have placed their demand, saying that the state government should increase their commission from 30 to 50 percent, as otherwise it would not be possible for them to continue with the business.

According to Nabanna sources, the state lottery used to take place once a week earlier, but following Chief Minister Mamata Banerjee's instruction, it now takes place every day since May 2018. As a result, the amount of lottery tickets published per day has gone up manifold.

The publication of tickets has gone up from around 17 lakh to 2.40 crore in 2018. During this period, the state government had sold tickets worth Rs 2,100 crore.