'Start building rockets' Anupam Mittal criticises 28% GST on online gaming

In response to the recent decision by the GST Council to impose a uniform tax rate of 28 per cent on online gaming, horse racing, and casinos, Anupam Mittal, founder of Shaadi.com voiced his disapproval.
 

The implementation of the blanket GST proposal has effectively put an end to the ongoing debate surrounding the classification of online games as either a "game of skill" or a "game of chance." This change places games of skill on par with gambling and betting activities, aligning them with wagering contracts. "Whether the change will be implemented prospectively or have a retrospective effect is still uncertain," Amit Gupta from SAG Infotech said.

This decision has disappointed online gaming companies and industry experts, who anticipated its negative impact on their ability to invest in new games, cash flows, and business expansion.

Mittal took to Twitter to express his dissatisfaction. In addition to criticising the GST on online gaming, he also commented on the rising prices of tomatoes in the country, suggesting that users invest in vegetables instead of cryptocurrencies.

''Latest lessons - stop gaming, start building rockets, move money from crypto to tomatoes,''Mittal tweeted. 

Latest lessons - stop gaming, start building rockets, move money from crypto to tomatoes 👾🚀🍅

— Anupam Mittal (@AnupamMittal)

Previously, Ashneer Grover, founder of Crickpe, also voiced his concerns over the 28 per cent GST on online gaming. Grover argued that the move would be detrimental to the fantasy gaming industry and called for startup founders to enter politics to ensure their representation in decision-making processes.

"It was good fun being part of the fantasy gaming industry - which stands murdered now. $10 Bn down the drain in this monsoon.  Time for startup founders to enter politics and be represented - or this is going to be spate industry after industry," he said. 

What is gaming industry body's take on 28% GST

The All India Gaming Federation (AIGF), representing companies like Winzo, Nazara, GamesKraft and Zupee strongly opposed the decision by the GST council, labeling it "unconstitutional, irrational, and egregious."

Responding to the criticism, Union Finance Minister Nirmala Sitharaman clarified that the intention behind imposing the maximum tax on online gaming and casinos was not to kill the industry. Sitharaman highlighted the "moral question" of taxing online gaming at the same rate as essential commodities.

The AIGF CEO, Roland Landers, raised concerns about the decision, claiming that it disregards decades of legal precedents and unfairly categorises online skill gaming alongside gambling activities. Landers warned that this decision could lead to the collapse of the entire Indian gaming industry, resulting in significant job losses, while benefiting illegal offshore platforms.

The imposition of the 28 per cent GST on online gaming continues to be a subject of debate, with industry representatives and entrepreneurs expressing their discontent. The long-term consequences of this decision remain uncertain, as stakeholders from various sectors assess its impact on the gaming industry and explore potential alternatives.