In October, the government introduced a 28% tax on the proceeds online gaming companies receive from customer bets, surprising a burgeoning $1.5 billion industry supported by global investors (The Indian government).
India expects to collect up to Rs 14,000 crore ($1.7 billion) in goods and services tax (GST) next financial year by taxing online gambling companies, Revenue Secretary Sanjay Malhotra told Reuters on Saturday.
The government in October imposed a 28% tax on funds that online gaming companies collect from their customers for every bet, shocking a nascent $1.5 billion industry that is backed by global investors. The government had defended the move, citing concerns about addiction.
In an interview, Malhotra stated that in the fiscal year ending on March 31, the Indian government is expected to collect approximately Rs 7,500 crore from the tax, marking an increase from the previous year’s 16 billion rupees.
The tax generated Rs 3,500 crore in the October-December quarter, he said. “The industry has stabilized, but it is early to make conclusive remarks,” he said. A review of the framework to tax online gambling companies will be conducted by April, but that doesn’t mean tax rates would be changed, he said.
The Indian government’s overall GST collections have averaged Rs 1.7 trillion per month, Malhotra said, adding, “We are expecting an average monthly collection of Rs 1.80 trillion to Rs 1.85 trillion from next fiscal” year.
