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28% Tax On Online Gaming – All You Need To Know About

tax on online gaming
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Gaming companies are not at all pleased by the decision of the government to levy GST on them under the Central Goods and Services Tax Act, 2017. Though the government has said the intention of this move is not to affect the gaming companies adversely, these companies feel this is going to bring down the gaming industry badly. The gaming companies are already paying 18% tax on online gaming, this move to levy tax on the full face value of the bets placed in online gaming and bets placed with the bookmakers when it comes to horse racing is the final straw for these companies when they are experiencing growth.

28% Tax On Online Gaming – Effect On The Gaming Industry

This tax on online gaming is a big setback for these gaming industries, and is not going to limit the cash flow but will also block business expansion. It can also lure gamers to illegal sites and other betting platforms that can cause the risk of losing users, leading to job losses, and revenue loss for the government. The high tax is a burden for these online companies in terms of expanding their businesses, creativity, and research. These companies earn a lot of money when gamers play online games like quizzes, poker, rummy, and sports games. 

Gaming tax is good revenue for the government, and the levy of this 28% tax has been met with a lot of criticism from the gaming industry. This tax burden can make online gaming less attractive to gamers as it is going to cost them more financially. Many countries benefit from their economic growth by taxing gaming industries, and since India’s gaming industry is growing and considered to be one of the top ones globally, this idea of increasing the tax to 28% by the government is seen as a smart move. 

The CEO of IndiaPlays, Aaditya Shah feels this tax on online gaming is challenging and change the gaming industry forever. The Director General of FIFS (Federation of India Fantasy Sports) Joy Bhattacharjya has said that this 28% tax is going to threaten the already invested FDI (Foreign Direct Investment) in the country and spoil further FDI in India. Ashneer Grover co-founder of BharatPe and the owner of gaming company Cricketpe thinks entrepreneurs should enter politics to rescue the gaming industry from declining in the country.


The online gaming industry has a lot of users in India. This tax on online gaming in the rapidly growing market of this industry is not to put a stop to online gaming or horse racing as the government puts it. They think by taxing this industry they will be able to get some transparency about the industry that has become complex.

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