Ban on real money gaming likely to cost Centre Rs 10,000-12,000 crore revenue

The central government is likely to lose between Rs 10,000-Rs 12,000 crore in revenue annually due to the ban on real money gaming (RMG). While the revenue loss is inevitable because of the ban, the GST cuts which are going to be effective from September 22^nd on online gaming will hopefully offset some of the loss. From September 22nd, online money gaming will attract 40% GST, as against 28% levy applicable at the moment.

The Promotion and Regulation of Online Gaming Act, 2025, passed by the Parliament in August, bars all forms of online real money games while promoting e-sports and other online games. The Act seeks to prohibit advertisements related to online money games and bars banks and financial institutions from transferring funds for any of such games.

A source indicated that the government was clear that real money gaming cannot be allowed, as many households are in severe debt, with states also wanting the ban to be imposed.

According to tax experts, the government’s expectation that a 40% GST rate will compensate for the revenue loss from banning real money gaming is optimistic. The 28% levy introduced in 2023 was estimated to have added Rs 15,000 cr annually, largely driven by high-volume real money games, which accounted for nearly three-fourths of the sector’s GST contribution. But by banning this segment, the government effectively shuts off the single largest source of revenue in online gaming, they said.