A gamer named Deep Patel has criticized the recent decision taken by the GST Council to levy 28% tax on full face value on online gaming and called out revenue secretary Sanjay Malhotra for allegedly terming gamers as “addicts” and gaming as “betting”.
In an open letter addressed to Malhotra, Patel claimed that the GST Council’s decision has left gamers “dismayed & appalled”. The gamer asked if gaming was against social values, then the government should ban all forms of it altogether.
Patel further said that many people even earn their livelihood playing games, and they practise games like poker and chess in the same way a sportsperson practises for their respective game. He goes on to question whether these sportspersons would also be called addicts?
Patel even claimed that Malhotra talked about “giving a level playing field for both onshore and offshore (illegal betting platforms)” and asked if the latter was hinting at indulging in betting. The gamer also added that the revenue secretary said that 28% GST will have economic rationale because people will use the time to do more productive activities.
The letter also shed light on the rapidly growing online gaming industry in India and talked about supporting the Prime Minister’s Digital India mission. It further explains how important gaming is to the digital economy of India and goes on to question again whether gamers were “betting addicts” or “a part of country’s ambition to be a leader of the world digital economy?”
The Indian gaming industry has seen rapid growth in recent years. A FICCI-EY report estimated that the online gaming sector will grow to Rs 23,100 crore by 2025. At this point, the real money gaming companies are claiming that the Council’s decision will put a huge dent in their ambitions to grow and, in fact, will potentially kill several startups.
The revenue secretary, however, has said that the decision is final with no scope of reconsideration. Currently, it remains to be seen that if the GST Council stands firm or gives in to the pressure and change the tax application criteria. As of now, the new tax policy only affects online real money games, in terms of gaming.