Gaming
Industry bodies raises concern over revised GST rates in online gaming
Mumbai: The three largest online skill gaming associations in the country, E-Gaming Federation (EGF), All India Gaming Federation (AIGF) and Federation of Indian Fantasy Sports (FIFS), expressed concern at the recent media reports, which suggest that the GST rate on online skill games may be increased from existing 18 per cent to 28 per cent.
In an official statement released, the three industry bodies said that what is more worrying is some media reports suggesting that the tax may be levied on total pool (prize money pooled plus the platform commission) and not on gross gaming revenue (GGR). The latter, if implemented, they said, will mean the demise of the online skill gaming industry in India.
EGF CEO Sameer Barde said, “Such a step is not only in dissonance with international best practices but is also violative of the principles of GST. Essentially, the online skill gaming operators are platforms, which bring players from various geographies together. The money pooled is eventually distributed to the winning player. The platform charges a predetermined fee, known as GGR, and pays tax on that. If you were to charge an increased tax rate on the entire quantum (pooled money plus commission), it is not only principally incorrect but will also annihilate this sunrise sector.”
Highlighting that the sector has immense economic benefits, the industry associations appealed to the GST Council to understand the salience of games of skill and take a decision considering international taxation best practices.
“Global studies have shown that incidence of taxation, on prize money instead of gaming revenue, leads to reduced tax collections for the exchequer and ends up giving a fillip to the black-market operators at the expense of legitimate tax paying players,” said FIFS CEO Anwar Shirpurwala. He further added that any regulations or taxation related to skill gaming should not be treated at par with games of chance, as these are very divergent activities both in terms of law and in practice.
With a combined membership of around 100 operators, between them, EGF, AIGF and FIFS, represent more than 90 per cent of the online skill gaming market in India. In the last few years, the online skill gaming sector has emerged as a growth engine for the Indian economy with direct benefits to a lot of sectors such as fintech, sports, animation & graphics, semiconductor, edtech and software development. The sector has also witnessed investments from marquee global venture capital and private equity firms. In the last six years, the online skill gaming sector has received foreign investment of over two billion dollars. The sector already employs around 50,000 people.
AIGF CEO Roland Landers said, “At one level the sector is very upbeat at the prospect of contributing towards growth of the Indian economy. We are very encouraged by the encouragement shown by the government, through formation of AVGC task force, constitution of inter-ministerial task force and the recent initiatives by MeITY to engage with the industry. But all this will amount to nothing, if it is not supported by a progressive taxation regime. An increased tax rate, and then levying the tax on the entire contest entry amount (instead of GGR), will be catastrophic for the industry, even nipping its potential in the bud.”
Gaming
Dream Sports sees 100 plus exits after gaming ban forces overhaul
Company splits into eight units as real money gaming law hits revenue.
MUMBAI: For a company built on fantasy leagues, reality has suddenly rewritten the rulebook. More than 100 employees have exited Dream Sports, the parent of Dream11, after the company reorganised its operations following India’s ban on real money online gaming. The shake up came after the Promotion and Regulation of Online Gaming Act, 2025 came into force in August 2025, prohibiting games where users deposit money expecting winnings. The regulation struck at the heart of the fantasy gaming industry and dramatically affected Dream Sports’ core business, wiping out about 95 percent of its revenue and all of its profits.
In response, the Mumbai based company shifted into what chief executive officer Harsh Jain described as “startup mode”, splitting its operations into eight independent business units in December.
Around 700 employees were reassigned across these newly formed ventures based on their experience and interests. However, roughly 15 percent opted to leave the company.
A spokesperson for Dream Sports said many of those who exited were experienced professionals accustomed to running scaled businesses rather than early stage ventures.
“Since some of these employees were experienced with running high scale businesses and not startups, around 15 percent chose to leave and join other scaled companies or start ventures of their own,” the spokesperson said.
Despite the departures, the company noted that the attrition rate is only slightly higher than its earlier level of around 10 percent before the ban. Dream Sports now has close to 950 employees and is not currently hiring, choosing instead to focus on stabilising its existing workforce.
The restructuring has transformed Dream Sports from a fantasy gaming company into a broader sports entertainment platform. The eight units now operate independently, each focusing on different segments of the sports and technology ecosystem.
These include Dream11, sports streaming platform Fancode, sports travel service DreamSetGo, mobile game Dream Cricket and artificial intelligence initiative Dream Sports AI, which includes sports analytics platform Dream Play.
Other ventures include fintech product Dream Money, open source initiative Dream Horizon and the philanthropic arm Dream Sports Foundation.
As part of cost saving efforts, Dream Sports also relocated its headquarters from Bandra Kurla Complex to Worli earlier this year. The new office, called Dream Sports Stadium, brings teams from its various brands together under one roof to improve collaboration and operational efficiency.
Jain had earlier said the company removed bonus lock in timelines for employees hired in recent years, allowing those who wished to leave to exit with pro rata payouts.
“We want people who are fully into the startup mode and willing to work for it, and we will share that reward if it comes,” he said.
Founded in 2008 by Harsh Jain and Bhavit Sheth, Dream Sports was last valued at 8 billion dollars after raising 840 million dollars in 2021 from investors including Falcon Edge Capital, DST Global, D1 Capital Partners, RedBird Capital Partners, Tiger Global Management, TPG and Footpath Ventures.
The new gaming law has forced several companies in the fantasy gaming sector to either shut down or pivot their business models, signalling a significant reset for one of India’s fastest growing digital entertainment industries.
