Delhi Finance Minister Atishi, in a press conference before the GST Council meeting on Saturday, said that startups have played a very important role in India's growth. Startups have played a huge role in providing employment to India's economy and people. But on one hand we talk about promoting entrepreneurs, on the other hand GST Council is taking many such decisions which are moving towards destroying the startup industry of our country. Let us tell you that in the GST meeting to be held today, the Finance Minister is going to discuss 28% tax on online gaming.
Delhi Finance Minister said this
Delhi Finance Minister Atishi said that today online gaming in India is the biggest growing sector in the startup economy and entrepreneurship in the startup sector. Online gaming is a sector in which more than 80000 people are employed. Foreign investment worth Rs 17000 crore has come in the online gaming industry. There has been so much growth in the online industry that there are more than 40 crore people across the country who use small online gaming like Ludo, Carrom as entertainment. Online gaming is considered a sunrise sector for startups but the GST Council recently took a decision and imposed 28% GST on the online gaming sector. Delhi opposed this.
Delhi Finance Minister Atishi further said that Delhi protested because online gaming is not a luxury sector, it is not like gambling, betting or horse racing where very rich people are involved in that sector. If you see today that many people play various types of small games on online gaming websites for entertainment in tier two cities across the country.
Industry will end due to imposition of tax- Atishi
Secondly, if 28% tax is imposed on these website industries, it will have a huge impact on the industry. If the legal online gaming industry is taxed this much, that industry will come to an end. When many startups are closed, we ourselves open the way for illegal gaming, but the good thing was that the GST Council also took a decision that we will review the 28% tax within 6 months and if there is growth in this sector. If there is too much downfall, we will reconsider it.
Atishi further said that this 28 percent tax was to be implemented from October 1, but before that, DGGI of GST Council sent notices of tax of Rs 1.5 lakh crore for the last 6 years to the entire online gaming industry. This Rs 23000 crore industry has to pay Rs 1.5 lakh. Tax notices worth crores are received, what will happen with this, the entire sector will be destroyed, no company will be able to survive which will be able to pay tax as much as its valuation. For example, there is a company, the total valuation of its company is Rs 19000 crores. The company has received a notice of Rs 10,000 crore that it will not be able to pay the tax. What will be the result of this? The result will be that the companies will not be able to pay the tax and the tax companies will be closed for not paying the tax.
Thousands of people will become unemployed
Atishi said that if the companies are closed, then more than 50,000 people working in the programs or those companies will become unemployed and secondly, the potential of providing employment in this entire sector will be lost. What kind of sector is this for the third time, there is already foreign investment of Rs 17000 crore in it, and foreign investment of Rs 25000 crore was in the pipeline, but when there is such an unstable tax environment, then which foreign investor would want to invest in these companies, not only this but this tax environment. It will impact not only the online gaming industry but the entire startup sector. Therefore, no foreign investor will want to invest in the country which today is passing out from college and engineering. He will do a good and safe job. Because starting your own startup is so risky.
Demand raised for withdrawal
Finance Minister Atishi said that despite the growth in this industry, if such a huge tax is imposed in our country, then startups will start getting scared, then where will our next Flipkart come from, where will our next Paytm come from, our next Zomato will come from? Where will our next OYO come from? Therefore, it is very important that such notices should be withdrawn by those who want to destroy the online gaming industry. Today is the GST Council meeting and I will definitely raise this issue in the GST Council meeting that the online gaming industry should be served with our tax notices. Will end it and it is necessary to withdraw these notices.
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