Will request GST Council to reconsider 28% tax on online gaming: MoS Rajeev Chandrasekhar

economictimes.indiatimes.com:

Rajeev Chandrasekhar has said he will “request the GST council for consideration on the new regulatory framework”. The GST Council on July 11 decided to impose a 28% GST on full face value for online gaming companies.Also read: Online gaming companies say only illegal platforms will gain from 28% GST Around 130 online gaming companies and industry associations, including Mobile Premier League (MPL), Nazara Technologies, Gameskraft Technologies and Winzo Games, have appealed to the GST Council to reverse the decision, saying that this would only benefit illegal platforms.

In an open letter, the companies noted that the online skill gaming sector in India has a $20-billion enterprise valuation and generates annual revenue of $2.5 billion. It is expected to grow at a 30% compounded annual growth rate to reach annual revenue of $5 billion by 2025, they added.

“The proposal to charge GST on full deposit value will reverse the growth trajectory of the industry. This would potentially have devastating implications (including shutdown of businesses) for MSMEs (micro, small and medium enterprises) and startups that may not have the capital reserves to withstand such a sharp tax increase,” the letter read.