Real-money gaming companies look for an ace to beat tax blues

economictimes.indiatimes.com:

For shorter games like rummy and poker, companies are trying out curbs on withdrawal of deposits to avoid being hit by repetitive taxation, as GST is levied every time a new deposit is made. For fantasy sports where the play duration runs into hours and a huge number of users participate, they are tinkering with the win percentage.

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Rummy and poker platforms that used to see over 70% of their users opt for daily withdrawals of winnings, according to industry executives, are slowly clamping down on this. Some like A23 Games are allowing only 15-20 daily withdrawals in a month, after which users can only pull out money a day later, people in the know said. A few have tried restricting withdrawals on heavy traffic days like Sundays.

For these games, the longer a user keeps money with the platform and “circulates” it for multiple games, the higher the compounded commission the company could earn, four senior industry executives said, three of them declining to be identified.

The platforms are testing this model to offset the impact of the new GST regime for the real-money gaming (RMG) industry. From last October, 28% GST is levied on the deposits made by players on RMG platforms. Fearing that the steep tax would discourage players, companies have been