Group of Ministers may oversee online gaming regulation

The Centre is likely to set up a group of ministers (GoM) to look into the regulatory framework for the gaming industry and consider other issues impacting the sector.

The GoM will likely include home minister Amit Shah, finance minister Nirmala Sitharaman, IT minister Ashwini Vaishnaw and information and broadcasting minister Anurag Thakur as members, ET has learnt.

“The work on creating an SRO (self-regulatory organisation) is going on,” a senior government official told ET. “We are talking to the industry but the overall consensus is to form a GoM to look into all the aspects of the online gaming sector.”

The ministry of electronics and information technology (MeitY) will continue to be the nodal ministry for online gaming. The proposed GoM will be assisted by senior officials from the department of revenue, income tax and Department for Promotion of Industry and Internal Trade (DPIIT) among others.

The online gaming industry is grappling with multiple issues including goods and services tax (GST) demands running into nearly Rs 1 lakh crore.

The enforcement agencies have also raised concerns over the possible use of gaming sites to launder money, tax evasion and lack of data. The GoM is expected to look into these concerns related to online gaming and the regulatory framework for the sector.

The government notified the rules for online gaming on April 6 and asked gaming companies and industry bodies to form an SRO within three months, adhering to guidelines prescribed by the MeitY.

The All India Gaming Federation (AIGF), Esports Players Welfare Association (EPWA), and All India Gaming Regulator (AIGR) Foundation, as well as a consortium of the E-Gaming Federation (EGF) and the Federation of Indian Fantasy Sports (FIFS) have already submitted draft proposals on an SRO, which is yet to be set up.

The industry has suggested the automatic blocking of gaming accounts after reaching a threshold, measures to prevent Foreign Exchange Management Act (FEMA) violations and strict reporting of users, including a detailed database of players and information on illegal betting sites.

The online gaming industry also agreed to include members of civil society in the SRO to minimise the adverse impact of online gaming, especially on schoolchildren, the official said. The GST Council, the apex decision-making body for the indirect tax, clarified in July that a 28% tax will be levied on the face value of bets placed in casinos, online gaming, and horse racing.