CEO of EvenBet Gaming Dmitry Starostenkov said, “Increasing taxation transparency and, hopefully, creating a distinction between different gaming activities is crucial for a mature market. We are excited to see that India is moving forward to clarify the sector regulation. The rational tax system will surely be beneficial for limiting black market illegal activities and boosting the growth of operators and startups.”
“Stimulating 5G development is very promising for online poker, which requires a stable and fast connection for all players, as over 85% of our software users in India play on mobile devices. However, the further steps to separate skill games and gambling taxation seem necessary to me: in poker, Teen Patti, Rummy, and other games of skill users are playing against each other and not against the casino, which requires a slightly different calculation approach. Still, taxing only winnings and not all the money withdrawn is a considerable improvement in favour of playing at the legal gaming resources,” Starostenkov added.
The founder, CEO of Nazara Technologies, Nitesh Mittersain spoke on digital infrastructure while sharing his opinion on the budget. He commented with, “The Union Budget 2023 has given prominence to digital infrastructure. The intent is not only on developing but building an ecosystem. The budget makes digitisation an integrated aspect of all sectors. AI is the next level in technology innovation and enterprise creation. The creation of three centers of excellence for artificial intelligence to enable ‘Make AI for India’ and ‘Make AI work for India’ will be a game changer in streamlining AI further. The budget also emphasizes developing applications under 5G as the country makes way for it.”
“While focusing on new pillars of growth, the budget has also given start-ups their due credit. Establishing a National Data Governance Policy to enable access to anonymized data and extending the date of incorporation for income tax benefits to start-ups will be a game changer. In addition, removing the minimum threshold of Rs 10,000/- for TDS and clarifying taxability relating to online gaming is one of the key takeaways. The proposed Union Budget also reflects the proactive approach by the government in streamlining the tax system and promoting fairness in the industry,” Mittersain added.
The VP Business Strategy of Head Digital Works Siddharth Sharma, also shared his opinion. He commented saying, “The inclusion of a specific provision for online gaming under Sec 194B of the Income Tax Act is not only progressive but also a win-win scenario for both the government and the industry. Deducting TDS on net winnings at the end of a financial year will catalyze the growth of this sunrise sector even further and this goes to show that this government has applied itself to solve for the needs of both the gamers and the industry. This is exactly the kind of outlook that India needs from the government in today’s digital economy.”
Jay Sayta, a gaming lawyer appreciated the cautious approach while also sharing how measures are being taken to get more clarity on the calculation of net winnings. He said, “The budget and Finance Bill, 2023 has provided important clarity on applicability of TDS for winnings on online gaming platforms that the industry was seeking. It is a welcome step that the concept of ‘net winnings’ has been recognised in the Income Tax Act for online games and TDS only has to be deducted at the end of the financial year or at the time of withdrawal from the user account.
Mr. Sayta also shared, “However, the manner in which net winnings are supposed to be calculated and the set-offs that may be permitted before calculating such net winnings are left to be clarified by the CBDT through rules/guidelines. Hopefully, the CBDT will soon provide guidance on the manner in which net winnings have to be calculated.”
“The new rules also bring parity between online gaming avenues such as apps and offline gaming avenues such as casinos. Other measures such as the relief in customs duty for import of critical smartphone parts such as lenses and batteries will help stabilize smartphone prices, and help more Indians access mobile technologies and games. The raising of the minimum taxable slab from Rs.5 lakh to Rs.7 lakh under the new tax regime will also indirectly help the industry, as it increases disposable income available to consumers,” he added.
Sayta ended with, “Experts also praised the overall support given to the startups in the form of the proposed National Data Governance Policy which will help start-ups access anonymised data, and providing the benefit of carry forward of losses on change of shareholding of start-ups from seven years of incorporation to ten years.”
The founder of Ability Games, Mr Suraj Chokani said, “It is an excellent budget from every aspect, from our point of view. The FM spoke about 7 major thrusts in the budget, calling it Saptrishi, out of which the 6th pointer spoke about new-age technologies. Recognizing such new age tech in itself is a big boost to the industry as a whole and shows the forward looking character of the Government. Focus on MSME and Startups is also a welcome step from our perspective and will help us go a long way. Overall we are very happy and satisfied with such an inclusive Budget.”
“Globally, the AVGC industry was valued at $168 billion in 2021, while the Indian AVGC industry was valued at $1.1 billion, a 28% growth over the previous year, according a report by the AVGC task force. The sector has plenty of room for growth, and the government’s recent decisions such as the proposed self-regulation of the online gaming industry and appointment of MeITY as the nodal Ministry will help boost the sector’s growth.”
The chairman and director of Yudiz Solutions Ltd, Mr Bharat Patel claimed, “Considering how fast India’s economy is adapting to modern technologies, the budget surely emphasizes the ‘Amrit Kaal’, mentioned by our Hon’ble Prime Minister. We at Yudiz are particularly thrilled that the government has recognised the potential of the gaming industry, and has taken steps in this budget towards fairer recognition of incomes from gaming.”
He added, “It is a positive move that the government has clarified that taxes will be applicable on net winnings, and not on aggregate winnings. We’re also grateful that Hon’ble Finance Minister FM Nirmala Sitharaman has said that the government will issue more clarity on the taxability of online gaming, and ease the tax burden. Proactive measures such as these can unleash the brimming gaming potential of India.”
The Chief Financial Officer of Mobile Premier League (MPL) Mr. Vikash Sureka had a lot to speak about on the Union Budget. He not only praised the government’s thought process on the gaming industry but also expressed how the nation is at a pivotal moment.
He said, “India’s online gaming industry is at a pivotal moment, and it’s great to see the government’s commitment to fostering its continued progress. The government in the Finance Bill has made a critical distinction between games of skill and games of chance, classifying them into separate sections. This signals the government’s recognition of the unique nature of each and the need for separate tax policies.
With the introduction of two new sections—194BA (for TDS of winnings from online games for online intermediaries) and 115BBJ (for computation of taxes for those who earn income from winnings of online games)—the government has cleared ambiguities regarding TDS calculation for online gaming and simplifies the process for both companies and users.”
Sureka continued saying,’ ‘The Bill allows TDS to be calculated either at the end of the financial year or at withdrawal, streamlining settlements and returns for users. With this change, users who play multiple games will only have to pay tax at year-end based on their net winnings, eliminating the need to pay tax on notional credit. For companies, the TDS calculation process is simpler, improving compliance. This positive step for the skill-gaming industry has us hopeful for continued government support and guidance.
In addition, the regulations being drafted by the Ministry of Electronics and Information Technology (MeitY) will create a favourable environment for the industry to flourish. We eagerly await the government’s direction on this and are also keen to learn more about the GST mechanism for online gaming. A clear, fair tax rate will boost investor confidence and create a conducive business environment. This year marks a turning point for the gaming industry and we look forward to collaborating with the government and other industry players to contribute to its growth and success,” he concluded.
The CEO of PlayerzPot, Sunil Yadav is glad with the recently announced Union Budget 2023. He expressed his thoughts on the announcement and said, ” It is rightly said that the Indian economy is on the right path and headed in the right direction. When the economy focuses on providing ample opportunities for citizens, particularly our nation’s youth, who are dedicated, focused, and enthusiastic about their goals, its development will be optimal. We are pleased to learn that the budget has prioritized youth empowerment and the creation of new jobs.”
“It is a welcome move to define the future of the online gaming industry to remove the minimum threshold of Rs. 10,000 for TDS and to clarify taxability. The action will result in transparency, a clear legal identity, and standardized taxation for online gaming. We hope that the government will unquestionably support the sector’s growth and development in the right direction, which will benefit the economy and its stakeholders,” Yadav added.
The Director of Esports Federation of India Mr Lokesh Suji said, “As stated by our honourable finance minister Nirmala Sitaraman in today’s Budget, mobile phone production in India has seen a significant rise in the past few years and that has undoubtedly been a game-changer for the Esports industry in the country. Contributing extensively to propelling the industry to unimaginable heights, the increasing availability of smartphones in India at affordable rates has not only expanded the player base by making gaming more accessible but has also attracted investment from companies, resulting in the development of existing as well as newer games.”
“With the numbers further upscaling and 5G acting as a catalyst that fuels the industry’s flourishment, we are going to witness monumental growth within the Esports sector in the coming years. As we are still awaiting clarity on the taxability for Esports, we are hopeful that the decisions will be in favour of the community and impact it positively, ” he added
The founder and CEO of 8bit Creatives, Animesh Agarwal shared his thoughts after the Budget. He said, ” The expansion of India’s gaming business mirrors and contributes to the growth of the mobile phone industry. The number of mobile gamers in India is projected to increase to 650 million by 2025, according to the most recent report from the Internet and Mobile Association of India (IAMAI).
The previous seven to eight years have been instrumental to the relationship of mobiles and gaming in India, with numerous mobile gaming titles being released and gaining popularity among the Indian gaming community. Developer dedication to expanding mobile gaming in India and the advent of different employment opportunities through mobile gaming have all contributed to an increase in the number of Indians adopting mobile gaming. This has also contributed to the growth of the mobile device sector, as professional gamers frequently seek to upgrade their devices as they progress in their career. Even casual gamers seek better devices in their gaming journey. Interdependence of the industries is also reflected in the commitment of the mobile device companies towards strengthening their presence in the gaming community through dedicated efforts and investments.
Witzeal Technologies CEO and Founder Ankur Singh reacted to the Union Budget 2023 by saying, “We are thrilled with the announcement of the first budget of Amrit Kaal that envisions an empowered and inclusive economy driven on the fundamentals of technology and knowledge. India is now the third largest ecosystem for start-ups globally and ranks second in innovation quality for middle-income countries. Fostering the development of start-ups in the online gaming industry, the initiative of ‘Make AI in India, make AI work in India’ will potentially boost the growth of gaming studios.
“The Hon’ble Finance Minister particularly mentioned clarifying the taxability relating to online gaming. Now as the Indian gaming market is expected to grow at a 27% CAGR reaching 8.6 billion dollars by 2027, government support will further help to streamline the industry and provide structured growth to this burgeoning industry.” Mr. Singh concluded.
FanClash co-founder Rishabh Bhansali, said, “The enormous upsurge in mobile phone production has been the impetus for the boom of the Esports industry in India. Pocket friendly smartphones have taken gaming and fantasy Esports to every corner of the country and a further decrease in its prices as the government proposes to reduce customs duty on import of certain inputs for mobile phone manufacturing will boost the sector’s growth like never before. We are extremely delighted with the propositions made in today’s budget and looking forward to the golden days that are in store for fantasy Esports and gaming in the country.”
Mr. Roland Landers, CEO of AIGF commented on the budget announcement, Mr. Roland Landers, CEO, All India Gaming Federation said, “The online gaming industry welcomes the budget announcement by the Hon’ble Finance Minister, particularly in relation to the rationalization of direct taxation for online gaming. We are happy to note that the Finance Bill carves out the distinction between betting and gambling activities and online games, through introducing a new section 194BA which taxes a user’s net winnings from online games at the end of the financial year. While we await CBDT’s clarifications and guidelines in this regard, we are hopeful that the certainty in taxation offered by the budget announcement will be a huge stimulus for the growth of the online gaming industry.”
Gaurav Kapoor, Chief Finance Officer (CFO) of Baazi Games shared his thoughts on the Union Budget 2023. He said, “We welcome the Amrit Kaal Union Budget 2023 with an optimistic perspective. The new income tax regime will result in stimulating local demand and consumption in the economy. The rise of India’s position from an importer to an exporter of mobile phones in India augurs well for the online gaming sector. Moreover, the announcement of setting up 100 labs for developing 5G services apps for smart classrooms, healthcare, and others will open up a new range of opportunities and potential employment.”
“Simplifying the KYC system process will further help in realizing ‘Digital India’ and will enable a seamless experience for consumers. Lastly, the ‘Make in India’ vision will further get a boost with a focus on “Make AI in India and Make AI work for India”, online gaming companies can develop new AI-based advancements that can provide a first-of-its-kind experience to users,” Kapoor added.
The upcoming taxation could have a major impact for all online real money gaming platforms in India!
-New TDS regime on online gaming
-'Net winnings' at the 'end of the year' shall be liable for TDS
-Method to compute 'Net winnings' to be prescribed
-No threshold limit for TDS deduction#BudgetwithMonik #Budget2023
— monikadvisors (@monikadvisors) February 1, 2023
FM Sitharaman: Removing minimum threshold of Rs 10,000 for TDS on online gaming and providing clarity on taxability. #BudgET2023 @EconomicTimes @ETtech
— Pranav Mukul (@pranavmukul) February 1, 2023
Here are few of the key points talked about by Nirmala Sitharaman in the budget with the New Tax Regime being a one of the most talked about topic.
income of Rs 0-3 lakh is nil.
Income above Rs 3 lakh & up to Rs 5 lakh to be taxed 5%. Income of above Rs 6 lakh & up to Rs 9 lakh to be taxed at 10%. Income above Rs 12 lakh and up to Rs 15 lakh to be taxed at 20%. Income above Rs 15 lakh to be taxed at Rs 30%.
— Sudesh More 🇮🇳 (@Thesudeshmore) February 1, 2023
Above ₹15L: 30%
Also, pay no tax if your income is up to ₹7L 🙂
Who all are the people who falls in 30% slab.
— पन्ना लाल (@itsmepanna) February 1, 2023
BIG Announcement on Personal Income Tax!!
NO tax to be paid for income below 7 lakhs!
This is a budget for salaried, middle class, poor & vulnerable. This is a budget for New India! #Budget2023 #AmritKaalBudget pic.twitter.com/2DhNcPWNQ7
— Manzoor Bhat (@MalangManzoor) February 1, 2023
It remains to be interesting what the future looks for India citing the highly awaited Union Budget 2023.
What are you looking for? A new India? #Budget2023
— Sumitro (@sumitrosircar) February 1, 2023
Exciting news for #crypto in India! If Union Budget 2023 reduces crypto tax to 15% & TDS to 0.1%, expect a huge boost in #crypto adoption. 🤞🤞 #cryptocurrency #UnionBudget2023 #Crypto #DigitalAssets
— bhavish Ramaswamy (@_bhavish) February 1, 2023
ALSO READ: Union Budget 2023: What Is India’s Online Gaming Industry Expecting?
Indians continue to express their funny side as we sit back in anticipation for the highly awaited budget!
Salaried class to Nirmala sitharam before budget…#Budget2023 #NirmalaSitharaman pic.twitter.com/56hmawU86w
— Krupesh Kothari (@krupeshakothari) February 1, 2023
Non-commerce friends to his Commerce friend today:#BudgetSession #StockMarket #Budget2023 #Budget pic.twitter.com/bOnVI6DhUo
— Puru (@preal958) February 1, 2023
The highly awaited copies of Budget 2023 are at the Parliament!
Delhi: Copies of #UnionBudget2023 arrive at the Parliament.
— GAURRAV HANDA (@gaurravhanda8) February 1, 2023
The online gaming industry can be considered as the fastest growing space of the Indian economy, with the Indian government recognizing the sector to be a crucial contributor to the exchequer. It has given a big boost to online gaming, which consists of various verticals such as poker, rummy, and fantasy sports, among others.
The field of real-money gaming, has seen exponential growth. Citing such emerging trends, India has a great opportunity at hand to push this industry towards scaling greater heights. With the Union Budget 2023 set to be announced today, Gutshot Magazine will be providing updates on all the important news announced by the Indian government with regards to the online gaming sector.
For more news and updates, keep reading Gutshot Magazine. Follow us on Facebook, Instagram, Twitter, and Telegram.
Amarylisa Gonsalves is a Content Writer at Gutshot Magazine. Advancing from a marketing background, she found her calling in writing. She takes delight in exploring genres and is a curious learner. Patient and ambivert, she believes in letting her work speak for itself. Apart from content writing, she finds solace in writing poetry by expressing herself through words. Additionally, she adores indulging in anything that satisfies her creative self, like drawing and DIY crafts.
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