GST on Online Gaming and Casinos in India
The shift to taxing full face value
Since October 2023, online gaming, casinos, and horse racing are taxed at 28% GST on the full face value of bets placed — not just on the platform's commission or gross gaming revenue (GGR) as was previously debated. This means if a player deposits ₹1,000 to place bets on an online gaming platform, GST of 28% applies to that full ₹1,000 entry amount, regardless of how much is eventually won back or lost.
Why this rate is unusually high
Online gaming, casinos, and betting are classified as "actionable claims" in the nature of gambling/betting under GST law, placing them in the highest-taxed category alongside other sin/luxury categories. This treatment applies uniformly whether the underlying game involves skill or chance, following the GST Council's decision to remove that distinction for taxation purposes.
How this affects platforms and players
Gaming platforms must register for GST and remit 28% on every deposit/wager cycle, which has materially changed unit economics for many operators, some of whom have adjusted deposit bonuses, minimum wager amounts, or exited the Indian market entirely in response. For players, this generally does not mean a visible "tax line" on each bet the way a restaurant bill shows GST — the tax is embedded in the platform's cost structure and often reflected in adjusted odds, fees, or reduced promotional bonuses.
Casinos and horse racing
Physical casinos (where legally operating, primarily in Goa, Sikkim, and Daman) and horse race betting follow the same 28% on full face value principle, applied to the total value of chips purchased for casino play or the total bet amount for race wagering, aligning treatment across all forms of licensed betting and gaming in India.
What this means for gaming businesses
Companies operating in this space need to budget for GST as a direct pass-through cost on deposit volume rather than a margin-based tax, register promptly regardless of prior turnover assumptions, and maintain rigorous records of face-value transactions distinct from platform revenue for accurate GSTR-3B reporting. Use the Standard GST Calculator to model the GST impact on deposit volumes at the 40% slab bracket used for comparison purposes (note: gaming's specific 28% rate on face value predates and sits alongside the general GST 2.0 slab restructure).