Illegal offshore betting platforms take advantage of GST situation, promote with ‘no tax’ claims

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With the GST Council’s decision to impose 28% tax on full face value on online gaming, illegal offshore betting websites have found a new way to promote themselves. These platforms are now claiming that there would be no GST or any other tax applicable on their offerings, thereby allowing users to take home the entire amount they win.

Illegal betting platforms like Winbuzz by Betfair, Gamer777, and 1xBet are teaming up with local influencers to promote themselves on various social media with the aforementioned claims. As per reports, they are even offering as low as Rs 1000 to some of the micro-influencers.

“They (offshore players) are taking advantage of the fact that gaming companies are in a Catch-22 situation right now as far as GST is concerned,” said a senior executive at an Indian gaming firm, as quoted by The Economic Times.

Several of these celebrities and influencers are still promoting these banned betting websites despite government advisories asking them not to. There has hardly been any change seen in the trend as it appears business as usual for these illegal platforms and individuals promoting them.

Notably, illegal and banned betting platforms do not need to pay taxes as they are not registered in the country. Efforts are being made to cut off access to them, however, they make a comeback using mirror domains.

On the other hand, the online real money gaming firms are registered in India. They claim that the criteria of the GST levy will make it harder for gaming startups to survive and will deal a heavy blow to the gaming industry, as a whole.

Most recently, casino operators like Delta Corp Ltd. also stated that the Council’s decision was illogical and might hurt the online gaming sector, but when asked about the effect on offline gaming such as casinos, Delta Group CFO Hardik Dhebar said that they will do well for the time being.

Meanwhile, the GST Council will be holding an online meeting via video conferencing on Wednesday, August 2 to decide if the tax is to be charged on initial deposits or on every bet made by the users.