‘Gamers must not be taxed the same way as gamblers,’ E-sport body says on 28% GST proposal on online games
GST Council meeting, the E gamers Players Welfare Association (EPWA) has shared a report on the booming industry of virtual games as the Group of Ministers on Tuesday is likely to include online gaming under the ambit of 28% GST slab. The GST Council has proposed to levy GST at 28% on total money deposited by the players to a gaming company as against the GST rate of 18% levied only on the platform fee. Against this backdrop, the EPWA director and Tech Policy lawyer Shivani Jha told Mint, "We hope that the council of ministers will take equitable steps to ensure an increased GST doesn’t discourage players from playing altogether.
Gamers must not be taxed the same way as Gamblers". According to a report by the eSports body, the Indian online gaming industry is growing annually at a rate of 30% and is one of the fastest-growing segments within the media and entertainment sector. As of May 2022, the country accounted for 19.2% of worldwide game downloads.
The compound annual growth rate of the gaming industry is of approx 22%. In 2021 India recorded about 390 million online gamers. As per the EPWA survey, if policymakers increase the GST on online gaming, 61 out of 100 online gamers might discontinue playing online games.
"Online gaming is a profession for some of us, an increased GST is a deterrent. Our investments in buying equipment also don’t give us any input credit, and now the proposed regime seems harsh." Zerah a professional gamer and CEO of Lxg told Mint. The proposed changes in tax rate will increase the financial burden on the gaming industry as they will become liable to pay tax on those portions of the money as well, which does not in any manner contribute to generating revenue for these companies, the report
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