Published Online:October 2024
Product Name:The IUP Journal of Law Review
Product Type:Article
Product Code:IJLR031024
Author Name:Aradhya Singh
Availability:YES
Subject/Domain:Law
Download Format:PDF
Pages:25-34
The Goods and Services Tax (GST) Council, in its 50th meeting, announced that online gaming, horse racing, and casinos will now attract a 28% GST at full value, as opposed to the earlier 18% on games of skill. This decision to levy such an exorbitant tax on online gaming giants has been taken with a view to regulate the industry. The change in GST rate could result in higher tax collections, but, at the same time, it could also lead to a decrease in foreign direct investment (FDI). In India, a game is categorized as a game of skill under territorial law if it is mostly determined by skill, while a game of chance relies heavily on luck. The fundamental question is whether online gaming is predominantly a game of skill or chance, and how it would attract GST. This paper examines the Indian government’s decision to impose 28% GST on online gaming businesses, its rationale, and how it would impact the online gaming market and FDI.
The online gaming (OG) industry in India has exponentially grown over the past decade owing to easy access to the Internet, becoming a key player in fostering enormous gaming markets globally. It has become one of the thriving sectors that has the potential to attract huge investments.