Vision In Vain: Online Gaming Industry Claustrophobic With 28% GST

Amrita Talwar, BBA LLB, University School of Law and Legal Studies, Guru Gobind Singh Indraprastha University

ABSTRACT

The COVID-19 epidemic and other factors have contributed to the huge expansion of the Indian online gaming industry, which is predicted to rise by 20% by 2025 and by 39% in 2022. The business is the fourth largest gaming market in the world and has greatly increased India's GDP. Both domestic and international investors have made large investments in Indian gaming companies, promoting the industry's growth and worldwide prominence. However, in order to continue development, encouraging measures including user friendly taxation and regulatory regimes, market-specific tactics, investor support and backing by the government is needed.

The gaming industry has voiced resistance to the 51st GST Council's suggestion of 28% GST on full face value. This high tax rate may threaten to undermine the whole online gaming sector. This high tax rate could potentially shake down the entire gaming industry and put the future and growth of the online gaming sector in jeopardy. A favourable tax environment is crucial for fostering industry growth, encouraging investments, economic development, competitiveness, and innovation, as well as reducing additional costs and drawing in a larger audience. The article includes the concerns around the recommendations made in the 51st GST council and how 28% GST is arbitrary and erroneous.