Online Gaming Sector to Attract Investment Once Taxation Policy Is Finalised: FM Sitharaman

The minister said the discussion is going on at the ministerial level in the GST Council into various aspects of online gaming.

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By Press Trust of India | Updated: 3 May 2023 15:43 IST
Highlights
  • Goods and Services Tax Council is chaired by Sitharaman
  • Online gaming witnessed a spurt during the time of the Covid lockdown
  • The issue of GST on online games has been going on for nearly two years

Last month, the Ministry of Electronics and IT notified norms for the online gaming sector

Photo Credit: Unsplash

Finance Minister Nirmala Sitharaman on Tuesday said the GST Council is deliberating on taxation policy for online gaming and exuded confidence that the sector will attract investment once it is finalised.

She was responding to a question from a Korean gaming company Krafton on what are India's plans to attract foreign investment in gaming companies.

The minister said the discussion is going on at the ministerial level in the GST Council into various aspects of online gaming, including taxation and regulation.

The Goods and Services Tax Council is chaired by Sitharaman and comprises finance ministers of states.

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"Once the policy certainty arrives, taxation becomes more ... clear, it will attract investors," Sitharaman said while addressing the Indian diaspora in Seoul.

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Online gaming witnessed a spurt during the time of the Covid lockdown, with the number of users in India rising substantially. As per a KPMG report, the online gaming sector would grow to Rs 29,000 crore by 2024-25, from Rs 13,600 crore in 2021.

The vexed issue of levying Goods and Services Tax (GST) on online games has been hanging fire for nearly two years now with many states pitching for a lower tax rate on those online games which require skill. They are of the opinion that games of skill should not be treated at par with games of chance.

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A final decision on the taxation on online gaming is expected to be taken by the GST Council in its next meeting, which is likely either this month or in June.

Last month, the Ministry of Electronics and IT notified norms for the online gaming sector, which categorically prohibits all such games involving betting and wagering.

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The online gaming sector will follow a self-regulation model and will initially notify three self-regulatory organisations (SROs) that will approve the games that can operate in the country as per the rules.

Responding to Krafton's question, Sitharaman, in a lighter vein, said she likes to watch memes and also animes of Japan and Korea.

"I'd love them to come to India...The mastery with which the story weaving happens, there is so much positivity...That's what we want for adults today," she said. PTI DP JD CS The correspondent is in Seoul on invitation of Asian Development Bank (ADB).


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