What are The GST Cost On Online Gaming In India?

What are The GST Cost On Online Gaming In India

Who doesn’t love procrastinating tasks or pass time by playing interactive games? But have you wondered that you ultimately pay taxes to the government while investing to win in your game? Taxes on games are solely aimed for mitigating practises of gambling, consumer protection, Governmental control over gaming industry and generation of funds for the government. Online gaming is currently split into two categories: skill games and chance games.

  • Games of skills: These are games where the outcome is mostly influenced by the player’s talent rather than chance, such as fantasy sports, chess, and rummy. The GST rate for skill games is 18% of the platform fees or commissions payable by the gaming operator. This only applies to the operator’s revenue, not the prize pool or total money received from players.
  • Games of chance: Lottery draws, placing bets, and gambling are examples of activities that rely heavily on luck. The rate of GST for activities of luck is larger, at 28% of the total amount risked or gambled by participants. This covers all money obtained from participants.

The GST structure for online gambling is under constant investigation and may alter. The authorities and GST Council are exploring adjustments to simplify and plan the tax structure. Suggestions have been made to either unify tax rates throughout various kinds of games played online, or to alter rates in response to changing models of operation in the digital gaming industry. It is critical for online gaming companies and players to keep up with the current legislation and changes in tax policies, since these can have a major effect on the cost and activities of online gaming in India.