Indian government expands taxes on online gaming winnings
Bonuses, referrals and incentives offered by online gaming companies will be taxed.
India.- The Indian government has announced that bonuses, referrals and incentives offered by online gaming companies will be taxed. According to Reuters, the government sees these as authorities part of a player’s winnings.
The new guidelines issued by the Central Board of Direct Taxes mandate online gaming companies to deduct taxes at the source if players claim net winnings, including any received bonuses or incentives. Bonuses and incentives will not be taxed if they remain unclaimed or are not withdrawn.
Under the new regulations, net winnings will be calculated by deducting the amount withdrawn by a player from the total sum of deposits to their gaming account, along with the opening balance at the beginning of the year. Players’ net winnings on online gaming platforms are subject to a 30 per cent tax rate.
If the amount withdrawn is less than 100 rupees (US$1.22) per month, companies will not be required to carry out tax deductions.
Meanwhile, the Goods and Services Tax (GST) Council is expected to provide clarity on tax rates for online gaming during its upcoming meeting, which is likely to be held next month. A finance ministry official said a council meeting will probably be held in June as state elections will be over by then.
The council will take up the report of the Group of Ministers (GoM) on online gaming, horse racing, and casinos. The report was not addressed at the 49th meeting of the council in February as chairman Conrad Sangma could not attend due to the elections in Meghalaya.