The impact of 28% GST on India’s online gaming industry: Growth, challenges, and future prospects – CNBC TV18

India’s real money gaming industry faces severe challenges after the 28% GST on deposits was introduced in October 2023. This tax change has dramatically reduced the sector’s growth prospects, slashing the previously robust 25% annual growth rate to a projected 8% CAGR between 2025 and 2028. Revenues are expected to decline by up to 30%, forcing over a quarter of gaming start-ups to shut down within a year and halting new major investments since October 2023.

The financial strain on the industry is evident, with approximately 55% of annual revenue now devoted to navigating GST-related impacts, pushing unit economics and EBITDA down by more than half. Adding to these challenges is the surge in offshore betting platforms that collectively process deposits worth ₹8.2 lakh crore annually, resulting in a GST loss of ₹2.29 lakh crore for India every year. While the government’s GST revenues have soared by 412%, sustainability remains uncertain without clearer regulations and stable policies. Ultimately, balancing taxation, regulation, and innovation is crucial if India’s real money gaming segment is to become a global leader and ensure a secure future.

Note: This is a partnered post. No CNBC-TV18 journalist has been involved in publishing this story.