Even as online gaming industry bodies pointed out an increase in companies’ financial burdens, India decided to levy taxes on online gaming companies on the total funds deposited to play online games and not on every bet, federal (Central) Finance Minister Nirmala Sitharaman said yesterday, offering some relief to the industry.

The decision was taken by the Goods and Services Tax Council, made up of finance ministers from all Indian States and chaired by Sitharaman, a Reuters report from New Delhi stated.

Sitharaman said the government aims to impose the tax from October 1 and a review of the decision would be undertaken in the next six months.

Last month, India decided to impose a 28 percent tax on funds that online gaming companies collect from their customers for every bet, shocking the nascent $1.5 billion industry, which is backed by global investors.

More than 100 gaming companies and top investors like Top Tiger Global and Peak XV, previously known as Sequoia Capital India, wrote to the government asking it to reconsider the decision.

Meanwhile, an official statement by the government, accessed by Indianbroadcastingworld.com, stated yesterday the GST Council in its 51st meeting recommended certain amendments in the CGST Act 2017 and IGST Act 2017, including amendment in Schedule III of CGST Act, 2017, “to provide clarity on the taxation of supplies in casinos, horse racing and online gaming”.

“The Council also recommended to insert a specific provision in IGST Act, 2017 to provide for liability to pay GST on the supply of online money gaming by a supplier located outside India to a person in India, for single registration in India for the said supplier through a simplified registration scheme and also for blocking of access by the public to any information generated, transmitted, received or hosted in any computer resource used for supply of online money gaming by such supplier in case of failure to comply with provisions of registration and payment of tax,” the statement elaborated.

A joint statement by E-Gaming Federation (EGF) and FIFS following the 51st GST Council meeting, sent to Indianbroadcastingworld.com, said: “FIFS and EGF, which represent 50 Indian online gaming companies, appreciate the government addressing the industry’s concerns on the issue of repeat taxation.

“The new tax framework, while clarifying and resolving uncertainty, will lead to a very burdensome 350 percent increase in GST and set the Indian online gaming industry back several years. However, it will allow gaming companies a fighting chance to innovate and rebuild the foundation of gaming in India.”