ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Regulating Online Gaming

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The recent crackdown on the online gaming industry by the union government has left the industry in a state of chaos. The government’s decision to impose a 28% goods and services tax (GST) on the gross value of bets has left many companies facing huge tax liabilities. In some cases, these tax obligations are even greater than the entire valuation of the firm.

The government’s rationale for this action could be that online gaming companies are not classified as banks or other financial institutions, and, therefore, are not allowed to take on any form of deposit. Any money that is deposited by a customer on these websites in the name of adding money to the wallet to play a game is considered as a service and not as a deposit.

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