India imposes 28% tax on iGaming company revenues
The Indian government recently announced that it would levy a 28% tax on the revenues that online gambling companies earn from their customers. It has to be said objectively that iGaming providers and operators have paid little tax until now. The Indian government’s recent decision is a blow to a sector that has grown in popularity and attracted foreign investors, and is now worth 1.5 billion dollars.
India: iGaming companies don’t approve of the government’s decision to tax them
India wants to tax online gambling companies on their revenues. Commenting on the government’s decision, Finance Minister Nirmala Sitharaman said: “ The decision to impose a tax on the total amounts collected by gaming companies was taken after extensive consultations. Our intention is in no way to harm the industry. “.
The last sentence of Nirmala Sitharaman’s speech is indeed intended to ease tensions with representatives of the Indian online gaming industry, who do not share the decision of the ministry concerned. According to iGaming operators, the tax will undermine their revenues, not to mention the additional costs that could be passed on to their customers.
Aaditya Shah, Director of Application and Game Operations at IndiaPlays, shared his fears: ” The implementation of a 28% tax rate will pose significant challenges to the gaming industry. This higher tax burden will have an impact on companies’ cash flows. “.
Roland Landers, CEO of the All India Gaming Federation, meanwhile had less measured words:” The decision to tax iGaming companies on their revenues is unconstitutional and irrational. This decision will wipe out the entire Indian gaming sector and result in numerous job losses. In the end, only illegal, anti-national offshore platforms will benefit from this measure. “.
Gambling addiction: a legitimate motive for the Indian government
The main reason for the government’s decision to tax the revenues of suppliers and operators is related to gambling addiction. gambling addiction. Indeed, although iGaming products are supported by top Indian champions and athletes – remember that cricket is India’s national sport – concerns have been raised about financial losses, debt risks and gambling addiction.
And yet, despite the questions they raise, mobile casino and sports betting applications are the subject of major investments within the Indian iGaming industry, such as Dream11, a group that is none other than the flagship sponsor of the national cricket team and is now worth over $8 billion.