Online Gaming Industry investors appeal to Modi, said – $ 2.5 billion will sink, know the reason

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Online Gaming GST Tax: After the decision to impose 28 percent tax on the online gaming industry, a group of 30 online gaming investors from India and abroad have written a joint letter to Prime Minister Narendra Modi. In this letter, he has said that the GST Council’s decision to impose 28 percent tax on the online gaming industry will drown US $ 2.5 billion of investors in online gaming. This letter has been written on Friday.

Prime Minister’s intervention urged on GST Council’s decision

Major investors including Peak XV Capital, Tiger Global, DST Global, Bennett, Coleman & Co Ltd, Alpha Wave Global, Kris Capital, Lumikai have also sought the Prime Minister’s intervention on the GST Council’s decision in a letter dated July 21. Also, the letter states that investment in online gaming is expected to reach US$ 4 billion in the next 3-4 years, but it will be badly affected by the imposition of 28 per cent GST on it.

Investors said, ‘They were shocked by the decision of the GST Council’

It also added, “The current GST proposal will impose one of the harshest tax regimes on the gaming sector in comparison to the rest of the world, threatening to wipe out USD 2.5 billion invested in the sector.” Investors said they were shocked and disappointed by the GST Council’s decision. This will reduce the trust in the Indian tech ecosystem or any other emerging sector to a great extent.

‘Adverse effect on potential investment of US$ 4 billion’

The letter also states that this decision will adversely affect the potential investment of at least US $ 4 billion in the next 3-4 years. Investors said that if GST is imposed on the ‘entire amount of stake’, the GST burden will increase by 1,100 percent. Also the taxation on the winning player would result in the same amount being taxed multiple times, leading to a situation where more than 50-70 per cent of each rupee goes to GST.

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