Esports exempted from 28% GST on full-face value, confirms game's top federation

Esports Federation of India (ESFI) on Monday said that the goods and services tax (GST) of 28 per cent will be levied on the full-face value of online gaming but will not affect the Esports industry. 

According to a report by MoneyControl, the GST will only apply to the iGaming sector, encompassing real-money gaming (RMG), fantasy sports, teen patti, rummy, and poker, which are classified as gambling or betting activities in other parts of the world.

Vinod Kumar Tiwari, President of ESFI and Director (NOC & International Relations/Marketing Department) at the Olympic Council of Asia, emphasised that Esports has been officially recognised as a sport by the Indian government, setting it apart from activities like iGaming, betting, and gambling. Thus, the GST for Esports will remain unchanged at 18 per cent, consistent with its previous tax rate.

Tiwari further pointed out that terms like 'game of skill' and 'game of chance,' which are specific to Indian regulations, do not apply to the Esports ecosystem. Instead, they only lead to misconceptions and confusion, associating the video games and Esports industry with iGaming and other gambling-related activities.

In April of this year, the government made amendments to the Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021, outlining a comprehensive framework for the online gaming ecosystem.

The President of ESFI recommended that the GST Council use more specific terms like 'iGaming,' recognised worldwide, or 'online real-money game,' as defined in "The Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules," to avoid any misunderstandings.

Tiwari also emphasised that the primary objective of the video gaming and Esports industry, comprising approximately 400 million Indian gamers and three billion gamers worldwide, is purely entertainment and not financial gain.

“The objective of the 400 million Indian video gamers and approximately 3 billion gamers worldwide is entertainment and not financial gains or making money. It is regrettable that in India, our video games or Esports Industry is often associated with iGaming, betting, RMG (real-money gaming), gambling and many more, which creates unnecessary confusion and misperception,” Tiwari said.

He also highlighted that video game publishers have stringent policies against implementing entry fees for Esports events organised using their games, further differentiating Esports from iGaming.

Esports continues to gain recognition globally as a competitive sport. It will be featured as an official medal sport at the 19th Asian Games, with India participating in four titles: League of Legends, FIFA Online 4, Street Fighter V: Champion Edition, and DOTA 2 (Defence of the Ancients).

Furthermore, Esports has recently been designated as one of the medal sports in the 20th Asian Games Aichi-Nagoya 2026. Notably, Esports was previously included as a demonstration title at the 2018 Asian Games, showcasing its growing prominence in the world of sports.

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