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The Supreme Court has denied a review petition on a pre-GST state lottery tax

In the pre-goods and services tax (GST) era, the Supreme Court denied a petition to review its decision to allow states to levy taxes on other states’ lotteries.

The Supreme Court has already overturned rulings by division benches of the High Courts of Kerala and Karnataka prohibiting respective state legislatures from imposing taxes on lotteries held by neighboring states, according to Sikkim.

The two High Courts ruled that the respective state legislatures had no such authority. It said that taxes on betting and gambling activities, including lotteries, is envisioned under Entry 62 of List II of the Constitution, regardless of the companies performing the same.

The Supreme Court upheld the Karnataka Tax on Lotteries Act of 2004 and the Kerala Tax on Paper Lotteries Act of 2005.

Now, the Supreme Court remarked that there was no mistake evident on the face of the evidence to warrant reconsideration of the assailed judgment.

The problem, according to Abhishek Rastogi, founder of the law firm Rastogi Chambers, was whether states would have the legislative competence to tax lotteries in their state, and this element was addressed by the highest court.

He pointed out that after the implementation of GST, taxes on betting and gambling were specifically removed from the state list.

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