The Supreme Court in January 2024 issued notice to the Centre on a plea filed by the E-gaming Federation against the levy of 28% GST on online gaming, according to The Hindu1. The notice marked an early stage of a dispute over how goods and services tax applies to real-money gaming in India, a matter that has since expanded into a much larger set of petitions1.
The core dispute concerns the interpretation of GST applicability on online gaming1. The government, represented by Additional Solicitor General N. Venkataraman, argued that 28% GST must apply to the total contest entry amount, effectively taxing the entire prize pool1. Gaming companies contended that GST should only be levied on their platform fees or commission, as many of these games involve skill rather than chance1.
The GST Council had in 2023 recommended that online gaming, along with casinos and horse racing, must be taxed at a uniform rate, and it decided against having any distinction between "games of skill" and "games of chance"1.
"In January 2024, the top court had issued notice to the Centre on a plea filed by the E-gaming Federation against the levy of 28% GST."
The dispute widened after that notice. On January 10, 2025, a Bench of Justices J.B. Pardiwala and R. Mahadevan stayed the operation of showcause notices of ₹1.12 lakh crore issued under GST proceedings against online gaming companies, in separate petitions filed by 49 online gaming companies1. Advocate Abhishek A. Rastogi, who represented the companies, said a freeze on further action protected his clients from coercive action and ensured that demands made in the showcause notices were not time-barred1.
The court had earlier transferred to itself 27 writ petitions pending across nine State High Courts challenging the levy of 28% GST on all forms of online real-money gaming1. Those petitions were tagged with a pending case concerning a Karnataka High Court decision that quashed a GST showcause notice of ₹21,000 crore while holding that online or electronic or digital Rummy played on Gameskraft was not taxable as a betting or gambling activity1. The Hindu reported that firms including Games 24x7, Head Digital Works and the Federation of Indian Fantasy Sports had moved the top court challenging the GST imposition1.
| Development | Amount or figure | Date |
|---|---|---|
| Notice to Centre on E-gaming Federation plea | 28% GST levy challenged | January 20241 |
| Showcause notices stayed by Supreme Court | ₹1.12 lakh crore | January 10, 20251 |
| Writ petitions transferred to Supreme Court | 27 petitions across nine High Courts | Reported January 20251 |
| Karnataka High Court notice quashed (Gameskraft) | ₹21,000 crore | Reported January 20251 |
What it means for players
The dispute is about how much tax applies to the money players put into online real-money games in India, and whether that tax falls on the full contest entry amount or only on the operator's fee or commission1. Until the courts settle the interpretation, the tax treatment of online gaming in India remains contested, and the government's position is that 28% applies to the entire prize pool1. The Supreme Court's stay of the ₹1.12 lakh crore in showcause notices concerns enforcement action against 49 companies, not a final ruling on the levy itself1. The GST Council's 2023 recommendation set a uniform rate for online gaming, casinos and horse racing and rejected any distinction between games of skill and games of chance1. For background on how gambling is regulated across the region, see Gambling Laws in Asia: What Is Legal in 12 Jurisdictions, and for India specifically, Can I Gamble in India?.
What happens next
The Supreme Court listed the case next on March 18, 20251. No further hearings or outcomes after that date have been reported in the source.
