Indian government hits iGaming industry with 28% tax

Recently, the Indian government announced that it will tax online game companies 28 percent on the funds they earn from customers in each game. In addition, companies have so far paid little tax on the fees they charge to provide real money games, and the government’s move has taken a toll on the $1.5 billion industry, which has gained popularity and attracted foreign investment.

iGaming companies do not agree with this decision:

Commenting on the government’s decision, Finance Minister Nirmala Sitharaman said, “The decision to tax the total amount that gaming companies collect was taken after consultation with the states, and the intention was not to harm the industry.” However, representatives of the iGaming industry do not appear to agree with the minister, saying, “It will frustrate their income and the extra charge is likely to be passed on to customers.”

Furthermore, Aditya Shah, chief operating officer of gaming app IndiaPlay, added, “The implementation of the 28 percent tax rate will bring significant challenges to the gaming industry. This high tax burden will affect the company’s cash flow.” In addition, Roland Landers, CEO of the All India Gaming Federation, said in a statement, “The decision was unconstitutional and (and) unreasonable. It will wipe out the entire Indian gaming industry and lead to job losses and the only people who benefit from this will be anti-national illegal overseas platforms.”

Reasons for the government’s decision:

The main reason behind the aforementioned government decision is that sports champions in India, where cricket is the most popular sport, are supporting gaming apps, but concerns have been raised about financial losses and potential addiction.

However, the aforementioned apps are one of the reasons why they are making large investments in the online gaming industry. One of the big impacts of these apps on India’s online gaming industry is Dream11, the $8 billion flagship sponsor of the Indian national cricket team supported by Tiger Global. When playing fantasy cricket on Dream11, players can pay Rs. 8 ($10) to build their own team and have the chance to win a large prize of Rs. 1.2 million ($14.565). In addition, Peax XV, formerly Sequoia Capital India, has invested in the MPL app. However, Dream11 and MPL did not provide an answer when asked for comment.

In a related development, Redshear Consulting said this month that “among the popular Indian Premier League cricket matches, revenue on the fantasy gaming platform rose 24% year-over-year to $342 million, with more than 61 million users participating.”

BY: 바카라사이트

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