Ashneer Grover claimed that the rise in tax seems like just 10% (from 18% to 28%) but in real terms, it will turn out to be the rise of 1300%
Ashneer Grover claimed that the rise in tax seems like just 10% (from 18% to 28%) but in real terms, it will turn out to be the rise of 1300%
PremiumEarlier this month, the Goods and Services Tax (GST) Council decided to levy a 28% tax on online gaming. The move by criticized by many industry leaders including BharatPe co-founder Ashneer Grover who called it the 'murder' of the online gaming industry. Ashneer Grover released an elaborate video on Thursday explaining the economics of the online gaming industry and requesting the government to reconsider the move.
Ashneer Grover claimed that the rise in tax seems like just 10% (from 18% to 28%) but in real terms, it will turn out to be a rise of 1300%. Plus, the added TDS will be too much for the gamer and the gaming industry will not be able to cover it with its whole revenue.
Ashneer Grover explained the math in detail how the tax of 28% imposed on the gamer will take away a large chunk of his earnings which will make the whole exercise futile and slowly people will start wading away from online gaming because it is not that profitable anymore.
The BharatPe cofounder submitted that the gamer will not play for such low returns and consequently, the gaming industry will not earn revenue which means no tax for the government. While appealing to the government to reconsider their decision Ashneer Grover gave the example of the stock market and said that the government doesn't levy GST on the whole amount but the brokerage earned.