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GST Council's 28% Tax On Online Gaming A 'Death Knell' For The Industry, Say Experts Sports
Kumar Shubham
Posted on 02 Aug, 2023
By Kumar Shubham
On 02 Aug, 2023
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By Kumar Shubham
On 02 Aug, 2023
Share

GST Council’s 28% Tax On Online Gaming A ‘Death Knell’ For The Industry, Say Experts

GST Council’s 28% Tax On Online Gaming A ‘Death Knell’ For The Industry, Say Experts: Federation of Indian Fantasy Sports and E-Gaming Federation, said, “FIFS & EGF, which represent 50 Indian online gaming companies, appreciate the Government addressing the industry’s concerns on the issue of repeat taxation. The new tax framework, while clarifying and resolving uncertainty, will lead to a very burdensome 350% increase in GST and set the Indian online gaming industry back several years. However, it will allow gaming companies a fighting chance to innovate and rebuild the foundation of gaming in India.”

Breaking: Govt Remain Firm On Their Stand!

While briefing the media, Finance Minister Nirmala Sitharam has said there will be no amendement to the early imposition of 28% GST. The previous decision will remain effective after all considerations and decision.

States Supporting GST!

The states of Maharashtra, Gujarat, Chhattisgarh, West Bengal, and Bihar, among others, support the 28% tax and want it implemented as quickly as feasible.

States Requested Reconsideration !

Goa, Delhi, and Sikkim demanded that a 28% tax on internet gambling be reconsidered. Tamil Nadu was also concerned.

The GST Council is expected to examine whether to put virtual digital asset transactions, payments, and prizes in online gaming under the 28 percent tax band, based on their total value, during today’s meeting on August 2.

The GST Council is likely to release the details for applying a 28% Goods and Services Tax on internet gaming, casinos, and horse racing. The decision was made at the Council’s 50th meeting in July, when it was resolved to levy a maximum tax rate of 28% on the entire value of bets placed on these activities.

Union Finance Minister Nirmala Sitharaman announced that the Goods and Services Tax (GST) Council has decided to impose a 28 percent tax on online gaming, casinos, and horse racing. This decision is being viewed as a setback for the online gaming sector.

A group of ministers analyzed the taxation of casinos, horse racing, and online gaming, and based on their recommendations, the tax rate was determined by a panel led by the Union finance minister and including representatives from all states and UTs.


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The GoM (group of ministers) was debating whether to levy a 28% GST on the face value of bets, or gross gaming revenue, or only on platform fees. According to Sitharaman, the tax will be levied on the entire amount.

In reaction to this decison the industry experts commented, if taxes are imposed on online gaming companies, they would have to increase the ticket prices of games without any differentiation between skill-based or chance-based games.

Twitter Trends Reflect People’s Anger Over 28% GST Implementation

People from all around India joined the Twitter trend to collectively condemn the government decision, where prominent business tycoons and gaming specialists warned the public about the seriousness of the move.

Some began mocking the decision, while others blamed Indian jerseys and declared that whoever funded the Indian team had met a nasty end. It started with Sahara, then Byju’s, and now Dream 11.

According to Aaditya Shah, the chief operating officer at the gaming app IndiaPlays, the gaming industry will face significant challenges due to the implementation of a 28% tax rate. This increased tax burden will negatively affect companies’ cash flows, as noted in a statement to news agency Reuters.

The All India Gaming Federation (AIGF), which represents companies such as Nazara, GamesKraft, Zupee, and Winzo, has expressed their disagreement with the council’s decision, calling it unconstitutional, irrational, and egregious.

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