2023 GST on online games MPL | WINZO [LATEST]

GST on online games MPL | WINZO | RUMMY | 3 patti cash withdrawal ऑनलाइन गेमिंग

TAX on GAMES

In 2023 Bad news for gamer to play online games you can pay extra cost for withdraw your money. When withdraw your money govt can fine 28% GST for every transection. The latest round of revision in the Goods and Services Tax (GST) has dealt a body blow to online gaming companies like MPL, WINZO, RUMMY, 3 PATTI etc. At the 50th meeting of the GST Council held on July 11, it was decided that online gaming, horse racing and casinos would attract a uniform GST of 28 percent on the full face value of the placed bets. Moreover, despite many representations by the sector, the Council also refrained from making any distinction between skill-based and chance-based online games, thus taxing them equally. The move has sparked sharp protests from the sector.

Till now, the GST charged for online gaming was fixed at 18 percent of the gross gaming revenue (GGR) of gaming companies. Now, under the revised norms, a 28 percent tax will be charged on the entry fee, which tends to be comparatively quite high in gaming. In a nutshell, this means gaming firms will now end up paying a steeper GST. To take an example, assume the entry fee that everyone has to pay to participate in a game is Rs 100, and the GGR-the difference between the amount placed by participants as a bet and the amount actually won by them-is Rs 20. Earlier, under the 18 percent GST on GGR, the tax amount translated to Rs 3.60. With the new revision, gaming companies will need to pay a 28 per cent tax on the entry fee, which, in this case, will mean a GST of Rs 28. This hike will have to be passed on to gamers, who are already burdened with the 30 percent tax deduction at source on net winnings from games.

While the Centre's argument for the tax hike is that the online gaming industry is currently paying only 2-3 percent GST, less than even the 5 per cent tax applicable on food items consumed by citizens, industry leaders have termed the move regressive. Online gaming companies saw their shares tumbling soon after the GST revision. The shares of Delta Corp, a casino operator that also has online operations, crashed 23 percent on July 12, while those of Nazara Technologies, a digital gaming and sports firm, plunged over 14 per cent. "The GST Council's decision to levy a 28 percent GST on online games without distinguishing between games of skill and chance poses a severe threat to the growth and sustainability of the online gaming industry in India," Kick Games Studios said in a statement. "These regressive measures disregard years of established legal precedents and unjustly associate online gaming with gambling activities and will have a negative impact on the growth of the real-money gaming segment, which accounted for 77 percent of India's gaming sector revenues in 2022," it added.

The online gaming market in India has seen a dramatic expansion over the past few years. According to a report by EY and FICCI, revenues of the country's online gaming segment rose from Rs 7,900 crore in 2020 to Rs 11,900 crore in 2022, and are expected to touch Rs 15,300 crore by 2024. However, India commands less than 10 per cent of the global market share in VFX (visual effects) and animation, per the Confederation of Indian Industry and the Boston Consulting Group. Last year, the Centre had set up an Animation, Visual Effects, Gaming and Comics (AVGC) promotion task force, which, experts had said, would help build capacity and create 2 million jobs in the sector. The task force had also suggested launching a 'Create in India' campaign with a sharp focus on content creation.

Against such steps, the GST hike is being seen as a major setback. Several gaming startups have urged the Centre to reconsider its decision, they believe that this will make India's online gaming sector ineffective. A letter signed by the Mobile Premier League, WinZO and industry associations said the move has left the sector in distress and that it will have a devastating impact on companies, some of whom may even be forced to shut down. The move will lead to a 400-500 percent increase in the GST burden, which the industry "will have no choice but to pass on to 400 million Indians", the letter said, adding that it can also lead to the proliferation of the underground black economy.

As things stand, there is no clarity yet on whether the Centre will take these concerns into account. The cards, for now, seem stacked against the online gaming segment.

• 18% GST LEVIED ON ONLINE GAMING TILL NOW, CHARGED ON GROSS GAMING REVENUE 
• 28% THE GST TO BE CHARGED UNDER THE REVISED NORMS ON ENTRY FEE 
• 11,900 crore REVENUE OF THE ONLINE GAMING SEGMENT IN INDIA IN 2022 
• 15,300 crore EXPECTED REVENUE OF THE ONLINE GAMING SEGMENT BY 2024 
• 400 million NO. OF GAMER IN INDIA, PER INDUSTRY ESTIMATES 
• SMART MONEY QUIZ

HOW SMART ARE YOU?

How much do you know about the basics of personal finance and banking?

BEGINNER

1. Which among the following is not a tax-saving instrument?

a) PPF

b) Life insurance

c) Health insurance
d) Car insurance

2. From which date are crypto assets taxed?

a) March 31, 2022

b) Jan. 1, 2023

c) April 1, 2023

d) None of the above

3. Under which section is an employer's contribution towards NPS Tier-I eligible for a tax deduction?

a) Section 80CCD (1)

b) Section 80 CCC

c) Section 80 CCD (2)

d) None of the above

4. Which of the following is levied by state governments?

a) Wealth tax

b) Estate duty

c) Entertainment tax

d) All the above

Q5. Income tax assessee includes

a) Individual

b) HUF

c) Company

d) All of the above

INTERMEDIATE

1. As per the Finance Bill 2023, the basic exemption limit under the new tax regime is

a) Rs 2.5 lakh

b) Rs 3 lakh

c) Rs 5 lakh
d) None of the above

2. A person may not have assessable income but may still be assesses?

a) False

b) May be

c) True

3. Which of the following is a progressive tax?

a) VAT

b) Sales Tax

c) STT

d) Income Tax

4. Agricultural income is considered when calculating tax if it is

a) More than Rs 5,000 and total income is exceeding exemption limit

b) More than Rs 10,000

c) More than Rs 5,000

d) Huge amount

5. In case of delay, payment of Income tax penalty is charged as

a) 2% per annum
b) 1% per month

c) 3% per month

d) None of the above

EXPERT

1. Tax audit is compulsory In case a person is carrying on a profession and whose gross receipts exceed which of the following?

a) Rs 40 lakh

b) Rs 1 crore
c) Rs 60 lakh

d) Rs 50 lakh

2. In some cases, assessment year and previous year can be the same financial year?

a) True

b) False
c) None of the above

3. In the new tax regime, the rebate under Section 87A is

a) Rs 25,000 up to taxable income of Rs 7 lakh

b) Rs 12,500 up to taxable

c) Rs 25,000 up to taxable income of Rs 5 lakh

d) None of the above

4. The new tax regime doesn't have a tax slab rate of?

a) 15%
b) 20%
c) 25%

d) 30%

5. Any planning of tax which legally helps reducing tax liability can be termed as

a) Tax planning

c) Tax avoidance

b) Tax evasion

d) Tax manipulation

FAQs