Over 130 online gaming companies and industry associations have written to the Centre urging it to reconsider the 28% GST on the full face value for online gaming. The companies have said that the proposal to charge GST on the full deposit value will halt the growth of the booming industry.
In the letter addressed to the government, the companies expressed their concern that implementing the GST on the full deposit value would have a detrimental impact on the industry's growth. They said that the 28% GST would make online gaming unaffordable for most people, and would discourage potential investors, both domestic and foreign, from considering the online gaming sector as an attractive investment opportunity.
The companies also said that the 28% GST would be unfair, as it would treat online gaming the same as gambling, which is illegal in most parts of India. They argued that online gaming is a skill-based activity, and should be taxed at a lower rate, such as the 18% GST that is currently applied to casinos.
The letter was signed by a number of leading online gaming companies, including Dream11, Mobile Premier League, and Paytm First Games. The associations that signed the letter include the All India Gaming Federation, the Federation of Indian Fantasy Sports, and the Indian Games Developers Association.
The government has not yet responded to the letter. However, the Finance Minister, Nirmala Sitharaman, has said that the decision to levy 28% GST on online gaming was not aimed at killing the industry, but was made considering the “moral question” that it cannot be taxed at par with essential commodities.
It remains to be seen whether the government will reconsider its decision on the GST for online gaming. However, the letter from the industry associations shows that the sector is concerned about the impact of the 28% GST, and is hoping that the government will take their concerns into account.
CAclubindia
