Gaming is a booming industry and the emergence is due to the rise in access to games by young generations. The gaming industry is no longer limited to certain games but a variety has emerged which pays the players accordingly. Just like all businesses one needs to file for GST registration of the services that are sold as part of the business.

GST on games has not been so prevalent though certain games do have the GST of 18 percent and 28 percent. And there needs to be a revision of the rates for a better taxation policy.

What is the GST on Games?

Games have been an industry where the GST Registration structure is a bit flawed. The games are no longer limited to physical activities but rather have evolved to include online sectors. The Taxation on games needs to be clearly defined in order to drive better tax measures.

The GST structure that has been in place for the games industry has been taxing the players at 18% for skilled games and 28% for chance-based games. But with the emergence of online gaming, it has become difficult to categorize them based on their nature.

Certain games require the person to have good skills to pass through and win while there are certain that require one's skills along with chances to survive. Thus games like these can not be taxed on either skill or chance-based.

Why is a uniform GST Required?

Gamers all around have been petitioning for a uniform GST payment at 18% which will include both the skilled and chance-based players. A final decision is yet to be taken by the court in regard to the GST payment slab for the gamers. There have been cases of the Income Tax department conducting investigations on the evasion of tax on gaming companies. This has led to an urgent need for the inclusion of a proper tax system.

There has been a case where online gaming is seen as a sinful act and a need for the highest tax demanded. The inability to verify the authenticity of the gamer in terms of personal information becomes a danger. It can be harmful to society if the restriction is not put on the games to prevent addiction or unauthorized practices. 

How does a uniform GST help gamers?

A uniform GST will have its own set of implications along with causing disruption in the gaming sector. All India Gaming Federation (AIGF) has said that it has filed for a Uniform GST if it happens to be kept at 18%. Not all games are the same and one needs to use their skills to play certain games while some need chances to play. While there are also games that require both in order to play. Thus having a uniform GST at a low percentage will benefit all players and not cause chaos. 

Conclusion

The gaming industry has taken a boom and as a result of the increase in the number of users, it has also generated a lot of revenue. The Government has been unable to categorize the games to tax accordingly. Thus it has become of utmost importance to draw a framework that can benefit both the players and the government in getting proper taxations.