28% GST on Esports Games: So Far, What Are the Impacts, Positive and Negative Both?

In 2023, the Indian government announced that it would be imposing a 28% goods and services tax (GST) on online games. This decision was met with mixed reactions from the gaming community, with some people arguing that it would be a positive development for the industry, while others feared that it would have a negative impact.

The 28% GST is predominantly on online games that require players to use their money to play such as real money games. Esports does not require a player to invest money, except for situations where the player wishes to get additional advantages like purchasing in game items, royal passes, etc. Thus the 28% has not direct impact on the esports industry.

28% GST on Esports Games Positive Impacts

There are a few potential positive impacts of the 28% GST on esports games. First, it could lead to increased revenue for the government. This additional revenue could be used to support the development of esports in India, such as by funding tournaments, training facilities, and marketing campaigns.

Third, the GST could help to attract foreign investment to the Indian esports industry. Foreign investors are more likely to invest in industries that are regulated, such as esports. This could lead to the creation of new esports teams and tournaments in India.

Players will now move to esports. Players playing Real money games will lose interest in those games since they attract higher taxes reducing their winnings. Esports on the other hand, will not be affected by 28% GST and most things remain unchanged. Thus more of these players will now tend to shift their focus on to esports.

28% GST on Esports Games Negative Impacts

As of now there are no negative impacts of the 28% GST known to esports.

28% GST on Esports Games Overall Impact

It is still too early to say what the overall impact of the 28% GST on esports games will be. However, it is clear that the 28% has little or rather no impact on the esports industry. Only time will tell whether the GST will be a net positive or negative for the Indian esports industry.

In the meantime, it is important for the esports community to continue to advocate for policies that will support the growth of the industry. This includes working with the government to ensure that the GST is implemented in a way that does not stifle the growth of esports in India.