India faces mass exodus of domestic online gambling market as government makes a mind-boggling decision to apply a 28% tax levvy. (Photo by Keith Lobo on pexels.com )
The government of India has made one of its gravest mistakes yet when it comes to gambling. A tax levy of 28% on online gambling transactions spells the rise of black-market online gambling in the country. It also saw shares in domestic gambling companies fall.
Why? Simply because companies that must pay this 28% tax levy will not be able to compete with overseas casinos. The cost burden of the tax will mean less promotions, higher spread in sports bets, and sometimes lower spec tech.
These issues are commonplace as operators pass the cost of taxes down to the consumer. Rather than deter gambling, it will open doors to casino with no attachment to India to advertise their superior value.
Obviously, someone either didn’t get the memo or a lack of research is likely to blame.
Alternatively, maybe too much influence from a leader or circle of leaders pushing personal agendas. That is opposed to relying on researched facts and figures. The hierarchy system in the culture may have once again played a part on what is the most ludicrous gambling tax rule implemented. And I don’t mean in India either.
Angry Association: The ‘All India Gaming Federation’ (AIGF) has said that the tax levy is unconstitutional, completely irrational, and egregious – all 3 points I agree with.
What were they thinking? A black-market is born!
Instead, it will allow it flourish in a black market where citizens of India will be at risk. Those that want to gamble will not pay the tax. Instead, they will seek out alternative platforms, and unfortunately, many of the alternatives are websites out scam people out of their money.
Luckily there are still 100s of safe online and live casinos out there operating under the Curacao and MGA licensing authorities that accept players in India. On top of this, many of these casinos accept Rupee and cryptocurrency.
The Problem for India’s Government: Rather than gamble at homebred online gambling sites in India, players will play at overseas casinos without any tax implications.
Who Will Pay the Tax?
It is not the platers, but the operators that will pay the 28% tax out of their revenues. This is all part of a long-awaited research report by a Taxes and Customs body. Here’s the tough part, which I don’t understand.
According to the chairman of the Board of Indirect Taxes and Custom – chairman of the Board of Indirect Taxes and Custom, these taxes apply to deposits prior to players making any bets. Furthermore, from what I can tell, these taxes apply to all types of gambling. That is regardless of whether the game requires skill, part skill and luck, or purely luck.
Warning: Before you read the next section, if you are in public, try not to laugh out loud (LOL). The reasons given for the tax levy are simply too funny!
Laughable Reasons Given for Tax Rate + Reasons Why the Tax Levy Will Fail India
Now I have never seen such a ridiculous set of reasons for these taxes. I mean every one of them is countered by the fact those that made the decision are obviously not aware that there is a black market out there.
Here they are (LOL)!
- Taxes are not intended to ‘kill the industry’: Well, they won’t. At least not the thriving overseas industry where players looking for gambling entertainment will head for better value. In the end taxes will kill the industry in India.
- Taxes are to stop young people getting addicted: Obviously cryptocurrency casinos overseas are not something the government researched. There are tons of young adopters of crypto. Furthermore, the younger generation will now head to black market casinos putting them at risk in an environment the government of India cannot control.
How will these players access overseas casinos? There are a growing number of VPN online casinos out there, such as Slottica Live. Although the legality of VPNs is in question, all my friends I know in India have VPNs.
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