For over a decade, real-money gaming companies and fantasy sports startups have marketed themselves as video game companies. But as these businesses f

Indian game firms want to distance themselves from fantasy sports

submited by

Style Pass

2024-07-09 05:00:06

For over a decade, real-money gaming companies and fantasy sports startups have marketed themselves as video game companies. But as these businesses face increasing regulatory scrutiny, a coalition of more than 70 video game companies in India is urging the government to create a clear distinction between their industries.

In a letter to Prime Minister Narendra Modi and the Ministry of Information and Broadcasting, the coalition requested the government to abandon the umbrella term “online games” in favor of distinct categories: “video games” and “real money games” as part of a broader request to boost the country’s digital entertainment sector.

This push for clear definitions comes in the wake of recent tax amendments that moved real money games to a 28% bracket while video games remained at 18%. The lack of clear differentiation has led to unintended consequences for video game companies, the video game firms argued.

“Companies making video games were subject to multiple show cause notices and tax raids, and banks and payment gateway companies have been denying services as well,” read the letter, a copy of which was reviewed by TechCrunch. Gmonks, Newgen, Lila Games, Dot9 Games, and Esports Federation of India are among the signatories in the letter.