India’s government has decided to impose a 28% tax on the turnover of online gaming companies, a move that could significantly impact the $1.5 billion industry.
What Happened: The decision to impose the tax was announced on Tuesday, July 11, 2023, by Finance Minister Nirmala Sitharaman. The tax will be applied to the total amounts that gaming companies collect from their customers.
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Why It Matters: The new tax regime could potentially affect the earnings of online gaming companies and lead to higher charges for customers. The online gaming industry in India has seen a surge in popularity and has attracted significant foreign investment.
Companies like Dream11, backed by Tiger Global, and MPL app, backed by Peax XV, are likely to be affected by this decision. The revenue of fantasy gaming platforms during the popular Indian Premier League rose 24% from a year earlier to over $342 million (₹2,800 crore) with over 61 million users participating.
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