India’s New Online Gaming Tax Will Stifle Foreign Investment, Put $2.5 Billion Investment at Risk: Gaming Firms

Many Indian ministers view bets on online gaming platforms as a "social evil."

By Reuters | Updated: 16 July 2023 05:10 IST

India’s New Online Gaming Tax Will Stifle Foreign Investment, Put $2.5 Billion Investment at Risk: Gaming Firms

Photo Credit: Reuters

Users can create a fantasy cricket team for as little as Rs. 8

Highlights

Top investors including Tiger Global and Peak XV have made investments
Gaming companies including MPL signed the letter dated July 14
Revenues of fantasy gaming platforms rose 24 percent during IPL

India's new 28 percent tax on online gaming companies will stifle foreign investment and put $2.5 billion (roughly Rs. 20,500 crore) already invested in the sector at risk, more than 100 gaming firms have said in a letter to India's finance ministry.

India this week announced the tax on the funds that online gaming companies collect from their customers. Games such as fantasy cricket have became increasingly popular in recent years, but have also raised concerns about addiction among players.

Top investors including Tiger Global and Peak XV, previously known as Sequoia Capital India, have invested in Indian gaming companies such as Dream11 and Mobile Premier League.

Samsung Wins Patent for a Tri-Fold Smartphone With Specialised Barrier Layer for Improved Durability

In the letter dated July 14, gaming companies including MPL urged the finance minister to rethink the move, highlighting the impact on jobs and investment.

The tax would deter potential investors, both domestic and foreign, from considering the online gaming sector in India as a viable investment destination, the letter said, and added that the current $2.5 billion (roughly Rs. 20,500 crore) plus in investments is at stake based on this decision.

India's finance ministry did not respond to an email request for comment, sent outside usual business hours. Federal Revenue Secretary Sanjay Malhotra told Reuters in an interview this week that the government believes social as well as economic purposes will be served by the tax.

Google Play Games for PC Beta Launches in India With These Games

Many Indian ministers view bets on online gaming platforms as a "social evil", Malhotra had said.

Revenues of fantasy gaming platforms rose 24 percent during the Indian Premier League cricket season from a year earlier to more than $342 million (roughly Rs. 2,800 crore), with over 61 million users participating, Redseer consultancy said this month.

Users can create a fantasy cricket team for as little as Rs. 8.

US Court Rejects FTC Request to Halt Microsoft Deal for Activision

© Thomson Reuters 2023

Will the Nothing Phone 2 serve as the successor to the Phone 1, or will the two co-exist? We discuss the company's recently launched handset and more on the latest episode of Orbital, the Gadgets 360 podcast. Orbital is available on Spotify, Gaana, JioSaavn, Google Podcasts, Apple Podcasts, Amazon Music and wherever you get your podcasts.

(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)

Affiliate links may be automatically generated - see our ethics statement for details.

Comments

For the latest tech news and reviews, follow Gadgets 360 on X, Facebook, WhatsApp, Threads and Google News. For the latest videos on gadgets and tech, subscribe to our YouTube channel. If you want to know everything about top influencers, follow our in-house Who'sThat360 on Instagram and YouTube.