India’s Growing Online Gambling Industry Faces Setback with 28% GST

The online gambling industry in India is experiencing a boom, but it is now facing a significant obstacle in the form of a 28% Goods and Services Tax (GST) imposed by the GST Council of India. This tax will apply to online gambling, casino games, and horseracing, encompassing both skill-based and chance-based games.

The decision to levy a 28% tax on the total chips purchased by players or the wagers they place has been met with concern from industry stakeholders. Nirmala Sitharaman, the Finance Minister, commented on the move, noting that the GST Act will be amended to include online gaming and horse racing. She also mentioned substantial discussions with various states, including Sikkim and Goa, which are popular destinations for casino tourism.

However, the announcement has sparked criticism from companies and organizations operating within India’s gaming sector. With the industry currently valued at $1.5 billion and attracting significant investments, stakeholders fear that the new tax could have severe consequences, including job losses and decreased investment.

Roland Landers, the CEO of All India Gaming Federation, expressed strong opposition to the decision, labeling it as “unconstitutional, irrational, and egregious”. He argued that the move disregards decades of established legal precedent and unfairly lumps online skill gaming with traditional gambling activities.

The implications of the 28% GST on the online gambling industry in India remain to be seen, but the decision has already stirred debate and raised concerns about its potential impact. As the industry navigates through this development, the focus on responsible gambling and self-exclusion tools has been emphasized as a way to mitigate any adverse effects.