Indian government imposes 28% tax on online gaming developers
The Indian Goods and Service Tax Council has increased the amount of tax on online games developers have to pay on money collected from players.
Online gaming, casinos, and horse racing will all be affected by the tax, and the levy won’t distinguish between "game of skill" and "game of chance" according to The Independent.
Developers previously only paid a small fee on games that involve real money, but the new tax will affect every game.
This information has sparked concerns among developers.
"The implementation of a 28% tax rate will bring significant challenges to the gaming industry," Aadiyta Shah, an executive at IndiaPlays, said. "This higher tax burden will impact companies’ cash flows."
Roland Landers, chief of the All India Gaming Federation trade body, called the decision "unconstitutional, irrational, and egregious,” warning that it would "wipe out the entire Indian gaming industry."
Reuters reported casino operators will also be impacted, as it "will be applicable to the value of chips a person buys before playing," according to Vivek Johri, chairman of the Board of Indirect Taxes and Customs.
Indian game developers previously objected to the government lumping traditional video games with gambling in the same regulatory category.
Online games like PUBG Mobile, Battlegrounds Mobile India, and Garena Free Fire have seen bans due to concerns with addiction and provoking violence in young people.
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