28% GST on online gaming 'unconstitutional, irrational, egregious', says industry

economictimes.indiatimes.com:

Online gaming industry stakeholders on Tuesday termed the 28% GST on the full value of gaming as «unconstitutional, irrational and egregious», saying that the move is a self goal that will kill the skilled online gaming sector in the country. The 50th GST Council has announced its decision to levy a 28% GST on online gaming, along with horse racing and casinos which comes as a drawback to online gaming companies. The GST will be applicable to gross revenue/total prize pool.

Roland Landers, CEO of the All India Gaming Federation, said that the decision ignores over 60 years of settled legal jurisprudence and lumps online skill gaming with gambling activities. «We believe this decision by the GST Council is unconstitutional, irrational, and egregious. This decision will wipe out the entire Indian gaming industry and lead to lakhs of job losses and the only people benefitting from this will be anti-national illegal offshore platforms,» Landers said in a statement.

Joy Bhattacharjya, Director-General, Federation of Indian Fantasy Sports (FIFS), said they are disappointed that the GST Council and authorities have chosen to apply 28% GST on the total entry amount including prize money. «A change in valuation to tax on the total consideration will cause irreversible damage to the industry, loss of revenue to the exchequer, and loss of employment for lakhs of skilled engineers,» Bhattacharjya said. The decision, say industry leaders, will shift users to illegal betting platforms leading to user risk and loss of revenue for the government.