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Reacting to the GST Council’s recommendation of a 28% levy on online gaming at full value, Rajeev Chandrasekhar, the Minister of State for Information Technology said on Monday that the government is in a nascent stage of creating a sustainable online gaming framework and once completed it will approach the council.
“The GST Council, represented by all state governments, is not the Government of India,” MoS Chandrasekhar said while speaking at CNN-News18 Townhall.
He added, “While there may be disagreements and industry discontent (on 28% tax on e-gaming), it is important to acknowledge that the process of establishing a regulatory framework for online gaming began only in January this year. We are currently in the nascent stages of developing a predictable, sustainable, and permissible framework for online gaming. Therefore, we will continue this process and approach the GST Council to consider the facts of the new regulatory framework.”
Extra burden on online gaming: Industry
The Goods and Services Tax Council decided to levy 28% GST on online gaming, horse racing and casinos at full value, Union Finance Minister Nirmala Sitharaman said after the conclusion of the council’s 50th meet in New Delhi.
A large section of the online gaming industry however said that the high tax burden will impact the companies’ cash flows, limiting their ability to invest in innovation, research, and business expansion.
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On this, the MoS IT said, “It is advisable to make gradual progress and evolve sustainable frameworks rather than rushing in response to sound bites, industry grievances, or angry startups.”
‘Preferable to prioritise doing things correctly rather than hastily’: Chandrasekhar
He added that PM Modi is committed to ensuring that all actions in the digital space are aligned with India’s technological advancement in the next decade. Hence, laws and rules undergo meticulous and in-depth consultation with stakeholders.
“We actively involve people in the process. The online gaming rules, which have recently been introduced, underwent an extensive consultation period of nearly three and a half months. I want to emphasise that the initial proposals put forth by the government and the final outcome were significantly different as a result of the consultation. Therefore, it is preferable to prioritise doing things correctly rather than hastily,” he said.
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