The 28% GST on Online Gaming

How the GST Council in 2023 imposed 28% GST on the full value of bets in online gaming, casinos and racing, and the effect on companies and tax demands.

In 2023, India changed how it taxes online gaming.

Before

Many platforms paid 18% GST only on their platform fee (commission).

After

From October 2023, 28% GST applied to the full face value of deposits on online games, casinos and horse racing.

Impact

Tax rose many times for platforms.
Some firms cut jobs or shut down.
Tax authorities issued large notices for past periods, which companies challenged.

Arguments

Supporters: treats gaming like other sin goods.
Critics: taxing the whole deposit ignores that most money is returned as winnings.

Economics

Tax changes can reshape an entire industry almost overnight.

The platform's bill

A rummy platform that paid tax on its commission now pays 28% on every rupee players deposit.

Thinking the change was small

It raised gaming taxes many times over.

Key takeaways

28% GST on full deposits began in October 2023.
Earlier, platforms paid 18% on fees.
Firms cut jobs and faced big notices.
Critics say it ignores winnings returned.