India to tax incentives offered to customers by online gaming companies

(Reuters) – Bonuses, sponsorships and incentives offered by online gaming companies to their customers will be considered part of winnings and are subject to tax, the Indian government said on Monday.

Online gaming companies will be required to deduct taxes at source if players claim their net winnings, including bonuses or incentives, as per guidelines issued by the Central Board of Direct Taxes.

However, bonuses or incentives will not be taxed if unclaimed or withdrawn, the agency said.

Net winnings will be calculated by subtracting the amount withdrawn by a customer from the total sum of deposits in the account and the opening balance at the start of the year.

A player’s net winnings on online gaming platforms are currently taxed at 30%.

Online gaming companies will not be required to deduct taxes on winnings withdrawn by a player if the amount is less than 100 rupees ($1.22) per month.

($1 = 81.7800 Indian rupees)

(Reporting by Nikunj Ohri in New Delhi; Editing by Anil D’Silva)