Chennai : E-Gaming Federation (EGF), an organisation representing top online skill gaming operators in India urges the government to consider Gross Gaming Revenues (GGR) for levying GST and keeping the service at an 18% slab.
According to a release, the GST Council reconstituted a Group of Ministers (GoM) in February 2022 to study the GST rates for casinos, racecourses, and online gaming.
The panel’s terms of reference stated that it will examine the valuation of services offered by casinos, racecourses, and online gaming portals, as well as the taxability of some casino transactions, all within the context of existing legal provisions and court orders.
Currently, a tax rate of 18% is levied on the commission (Gross Gaming Revenue or GGR) collected by the online gaming platforms for each game that does not involve betting or gambling.
Elaborating on the recommendation, Sameer Barde, CEO, EGF, said, “A higher tax burden will make the industry unviable. The gaming platform operators will be unable to continue operations at any meaningful level. Growth, innovation, employment opportunities, government revenues and most important responsible and safe gaming will be impacted in a big way. We urge the GoM to consider the industry’s unique needs and recommend the continuance of the current practice of considering GST to be paid on GGR, with the rate remaining at 18%. As online gaming is different from gambling and the Supreme court and several High Courts have reaffirmed the status of skill-based games as legitimate business activity, rational tax treatment of online skill gaming will help in creating mutually benefitting situations for all the stakeholders.”
“We are witnessing the start of a new era in India’s gaming sector. The fact that the government is supporting the industry is really encouraging. The sector’s true growth story, however, will be determined by progressive and favourable policies that establish best practises and encourage responsible gaming,” he added.