28 Percent Gst On Online Games
It is really a matter of criticism or deep sadness as the government has imposed a tax of 28% on the online game. Online gaming has both positives and negatives as it feels that children are getting addicted to it. But still, a tax of 28% is really high as because of this there is a high chance that the concept of online gaming may be wiped out completely.
Nirmala Sitharaman (Finance Minister) announced in the 50th GST Council meeting on Tuesday that government will soon impose a GST of 28 percent on online gaming, horse riding, casinos, etc. Several industry experts have mentioned their concern over this and said that this may lead to various big losses to the online gaming industry. As mentioned in the Forbes report, there are nearly 400 million online gamers, and among these 90 million gamers are those who play these games on daily bases.
What does 28 Percent Gst exactly mean?
According to the new GST rules, a person has to pay Rs 28 as Gst for RS 100 which he will spend on online games. According to the gaming companies, this 28% GST will limit their expansion. People will also be at great risk of losing jobs.
Even some of the All Indian Gaming Federation Companies like Winzo, and Nazara called this as void and unconstitutional. This is what the big industrialists Roland Lnaders Ceo of AIGF said the decision completely ignores 60 years of legal jurispendence and mixes online skilled gaming into gambling activities. He further said that it will only benefit the anti-national or illegal platforms.
The online gaming companies consolidate and urged the government to take necessary action and reduce the GST which is from 28 percent to 18 percent.
Major Impact On FDI
The DG Of India Fantasy Sports Federation Mr. Joe Bhattacharya said that this decision will severely impact foreign direct investment (FDI). Even he gave a figure of 2.5 billion of impact in FDI. He further added that this decision will shift the users to other gaming platforms that are completely illegal and these betting platforms may pose a risk to users and even a great loss of revenue to the government.
Ceo Of India Plays Mr. Aditya Shah said that this 28 percent of GST may bring major challenges for the gaming industry. This will further lead to the loss of innovation as if the tax burden is higher then the cash flows will be less which may lead to their inability to invest.
If we talk about the opinion of Bharat Pe Cofounder Mr. Ashneer Grover then he said that this the murder of online fantasy gaming and lashes out at the government’s decision of 28 percent Gst on Online gaming. He has also launched his new gaming company Crickpee. He further added that this is high time we as entrepreneurs should enter into politics as in the future government will do the same for every industry.
