Online gaming companies in India have received massive tax notices under the new taxation rules, which came into effect late last year. Since September 2022, gaming companies like Gameskraft and Delta Corp, among others, have been served notices to pay a staggering Rs 1.12 lakh crore in dues, according to calculations by the GST department.

This amount, calculated at 28 per cent on the face value of bets, has put pressure on the sector, as per a report by Moneycontrol. Despite hopes for relief at the upcoming GST council meeting in June, following the formation of a new government, a reduction in the taxation policy remains uncertain.

“The GST Council meeting will happen in June-end, after the new government comes in. It will review online gaming revenue from October 1 (2023) onwards,” a senior official told to a credible source. “The Council had decided 28 per cent on the face value, and this is likely to continue as the GST revenue of the government from online gaming has increased 5-6 times in the last six months. The tax data will be compiled and presented before the Council," he added.

Last year, in October the GST Council implemented a 28 per cent GST on the total face value of online gaming bets. However, there was a hope that the proposed tax slab would be reassessed after six months.

The online gaming industry wants the imposed GST to be calculated based on gross gaming revenue rather than the face value of bets.

“Earlier the GST from online gaming was at Rs 200 crore per month, approximately. The figure has gone up quite substantially since October 1, 2023 to Rs 1,100 crore per month. The last revenue assessment from online gaming was done in Haryana and Karnataka,” the spokesperson cited above stated.