India’s finance ministry has received a letter from over 100 gaming companies expressing concern about the country’s new tax on online gaming, which is set at 28%. The companies argue that this tax will hinder foreign investment and jeopardize the $2.5 billion (roughly Rs. 20,500 crore) already invested in the sector. The popularity of games like fantasy cricket has been on the rise, but there are also concerns about addiction among players.
Major investors such as Tiger Global and Peak XV, formerly known as Sequoia Capital India, have made significant investments in Indian gaming companies like Dream11 and Mobile Premier League. In their letter dated July 14, gaming companies, including MPL, urge the finance minister to reconsider the tax, emphasizing the negative impact it will have on employment and investment.
According to the letter, this tax will discourage potential investors, both domestic and foreign, from considering India’s online gaming sector as a viable investment destination. The companies also highlight that the current investments totaling $2.5 billion (roughly Rs. 20,500 crore) are at risk due to this decision.
Unfortunately, India’s finance ministry has not responded to requests for comment at this time. However, Federal Revenue Secretary Sanjay Malhotra told Reuters in an interview that the government believes the tax serves both social and economic purposes. It is worth noting that many Indian ministers view online gaming platforms as a “social evil,” as stated by Malhotra.
According to Redseer consultancy, revenues of fantasy gaming platforms saw a 24% increase during the Indian Premier League cricket season compared to the previous year, surpassing $342 million (roughly Rs. 2,800 crore). Over 61 million users participated in these platforms. Users can create a fantasy cricket team for as little as Rs. 8.
In other news, the Nothing Phone 2 has been launched, sparking discussions about its relation to the Phone 1. To learn more about this topic and other tech news, tune in to the latest episode of Orbital, the Gadgets 360 podcast.
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Eugen Boglaru is an AI aficionado covering the fascinating and rapidly advancing field of Artificial Intelligence. From machine learning breakthroughs to ethical considerations, Eugen provides readers with a deep dive into the world of AI, demystifying complex concepts and exploring the transformative impact of intelligent technologies.
