• Notification Date: 13-11-2023
• Notification No: N/A

About 60% Indian Gamers Pay Less after Govt Imposes 28% GST on Gaming Sector

As many as 60 per cent of real-time gamers in India are paying less after the recent decision by the Indian government to impose a 28 per cent good and service tax (GST) on the gaming industry. 

According to a report by Lumikai Interactive Entertainment Venture and Google, the impact of 28 per cent GST and tax deducted at source (TDS) on the gaming industry.  

In September, the finance ministry's revenue department revised the tax rate on online gaming, increasing from the previous 18 per cent to 28 per cent. Later, it was agreed by the 51st GST Council meeting. 

The report titled ‘State of India Gaming’ highlighted the decline in funding for India's gaming industry. Compared to last fiscal year funding decreased by 75 per cent in 2023, resulting in a global drop of 79 per cent. Previously USD 1.744 billion worth of investments were recorded in 2021 but it fell to USD 567 million in 2022. 

The report revealed that retrospective tax imposed by authorities is higher than the gaming sector's revenue. Tax notices issued between FY18-23 amount to USD 8.9 billion, while the industry generated only USD 4 billion in revenue.  

However, despite these many setbacks, the gaming sector's growth remains still strong. India recorded approximately 15.4 billion game downloads in FY23 over 568 million gamers, which is more than half of internet users in India and the paid users have risen by 17 per cent year-on-year (YoY), reaching 140 million. 

The report stated that half of the country's gamers fall within the 18-30 age group, with a gender split of 60 per cent males and 40 per cent females. In FY23 there has been a 66 per cent surge in gamers from non-metropolitan areas compared to 57 per cent of previous.