An all-party delegation from Kerala, including MPs and trade union leaders, on Friday submitted a memorandum to Union Finance Minister Nirmala Sitharaman, urging the Centre to forestall the move to increase the GST on lotteries to 40 from 28 per cent.

During September 3 and 4, the GST Council will consider the recommendation to increase the GST on lotteries to 40 per cent. The memorandum said that the increase would destroy Kerala lotteries.

"Lottery workers come from the most disadvantaged sections of society. Over two lakh handicapped, aged and sick earn their livelihood from lottery sales. It is unjust to say that the high 28 per cent slab would be abolished and then to slap a 40 per cent rate on lotteries," the memorandum said.

As it stands, the sale of a ₹50 ticket will fetch a commission of ₹8.50 for an agent and ₹7.35 for a seller. If the hike is allowed, the commission will drop to ₹4. The memorandum also said that a fall in lottery revenues could even hit various social welfare schemes of the Lottery Workers' Welfare Fund Board, like pension, bonus, treatment expenses, assistance to bereaved homes, pregnancy assistance and even the distribution of three-wheelers for the handicapped. It said that Karunya Arogya Suraksha Project (KASP) is run using lottery revenues. "The scheme that benefits over 42 lakh families provides free treatment to over 6 lakh people," the memorandum said.

The memorandum said that the GST rate on lotteries should be pegged at 18 per cent. "There will be only two slabs of 5 and 18 per cent if the Centre's recommendation to abolish the 28 per cent is accepted. For ultra-luxury items, the recommendation before the GST Council is a GST of 40 per cent. Lottery is not a luxury item. So it is unjust to place lottery in that higher slab. Instead, it should be placed in the 18 per cent slab," the memorandum said.

Further, it was said that the lotteries sector would now suffer a 350 per cent increase in GST rate, considering that it was increased from 12 to 28 per cent in 2020. 

CPM state committee member Jayarajan, who was part of the delegation, said that the union finance minister had promised the delegation that she would present the submission of the Kerala Lotteries Protection Forum before the GST Council. He said that the Forum would organise a state-level lottery convention in Ernakulam on September 8. "The Forum will launch strong agitation measures if the Centre refuses to pull back from the move to slap a higher GST rate on lotteries," Jayarajan said.

Besides Jayarajan, the delegation had Rajya Sabha MPs V Sivadasan (CPM), P Santosh Kumar (CPI), CITU leaders P R Jayaprakash and T B Subair, INTUC's Philip Joseph, V Balan of AITUC and J Jayakumar of KLTA (Kerala Lottery Thozhilali Association).