The Goods and Services Tax Council (GST) recently announced the decision to levy a tax at the uniform rate of 28 percent on online gaming, horse racing, and casinos. Online gaming companies and industry experts are disappointed with the decision, given it will limit their ability to invest in new games and impact cash flows as well as business expansion.
Weighing in on the matter, Shaadi.com founder and Shark Tank India judge Anupam Mittal slammed the move, saying that entrepreneurs should now build rockets rather than gaming companies. He also took a dig at the rising prices of tomatoes in the country and asked users to invest in the vegetable instead of cryptocurrency.
''Latest lessons - stop gaming, start building rockets, move money from crypto to tomatoes,'' Mr Mittal wrote in a tweet.
Earlier, entrepreneur Ashneer Grover also lashed out at the 28 percent GST on online gaming, saying the move will murder the fantasy gaming industry, adding that it's time for start-up founders to enter politics.
Mr Grover had launched his own fantasy gaming named Crickpe in April this year, which allowed users to create a virtual team of cricketers based on their current form.
"It was good fun being part of the fantasy gaming industry - which stands murdered now. $10 Bn down the drain in this monsoon. Time for startups Founders to enter politics and be represented - or this is going to be spate industry after industry," he said.
The All India Gaming Federation (AIGF), which represents companies like Nazara, GamesKraft, Zupee and Winzo, said the decision by the council is "unconstitutional, irrational, and egregious".
Union finance minister Nirmala Sitharaman said the decision to levy maximum tax on online gaming and casinos was not intended to kill the industry but considering the "moral question" that it cannot be taxed at par with essential commodities.
"The decision ignores over 60 years of settled legal jurisprudence and lumps online skill gaming with gambling activities. This decision will wipe out the entire Indian gaming industry and lead to lakhs of job losses and the only people benefitting from this will be anti-national illegal offshore platforms," AIGF CEO Roland Landers said.
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