India’s GST tax amended and brought into effect

India’s cabinet has fully approved amendments to the Goods and Tax (GST) affecting multiple segments of the gambling sector including online gaming.

Despite heavy criticism of this amendment, a 28 per cent tax rate will go ahead and is poised to be applied to online gaming products, land-based casinos and horse racing specifically. 

Significantly, this change extends these regulations to foreign gaming operations facing the Indian market, with stringent regulatory actions authorised against any non-compliant operators. 

These amendments have yet to receive an official release with further particular details of their contents yet to be provided.

The Indian parliament’s monsoon sessions, designated between July and August to discuss the most prominent of issues across the Asian sub-continent, are set for an imminent conclusion and subsequent to this the government is poised to implement these amendments by October 1st. 

Full face value tax

Many industry leaders and even certain lawmakers have decided this 28 per cent tax will be levied on the “full face value” of individual bets in all the previously mentioned gaming segments.

This would set the tax rate exponentially higher as opposed to when the tax was collected based on gross gaming revenue (GGR). 

Industry backlash was in part considered, with the tax amended to apply to initial deposits instead of individual bets. 

Moving forward

The GST on gaming will also be subject to review 6 months after they come into effect.

Additionally, esports and non-wagering video games will remain exempt from the 28 per cent GST as they are not categorised as “pay to play” products with a government spokesperson stating:

“Esports and video games intended purely for entertainment and not involving betting, gambling or any money transactions, will continue to be taxed as they have been.”

GST industry effect

The Mobile Premier League fantasy sports platform has already unveiled plans to cut 250 employees as a result of the GST arrangements, claiming the tangible tax burden will be somewhere in the realms of a 300 to 400 per cent increase.

It has also been reported that Delta Corp, a casino and iGaming operator has also suspended plans for an initial public offering predicate don its fledgling online gaming arm.

Nostalgia Technologies has also shelved operations due to the GST. 

SiGMA Balkans/CIS

As a globally recognised nexus for networking, SiGMA Group sets its sights next to the Balkans this September, when the SIGMA Balkans/CIS Summit heads to Limassol Cyprus.

A host of networking opportunities and industry-leading knowledge will be emanating from the much-anticipated event which will pack panel discussions, keynote speeches, start-up pitches and much more into 3 days in the diverse Cypriot city.