Super Group Withdraws from India amid New 28% Gambling Tax
LISTEN TO THIS ARTICLE:Super Group, the parent company of Betway and Spin brands, has officially declared the cessation of all operations in India.
The operator made the decision to exit the Asian country after the Indian government implemented its new Goods and Services Tax on October 1, 2023.
India’s New Gambling GST Pushes Super Group Out
During the summer, India's Parliament granted approval for the Goods and Services Tax Council (GST) to modify tax rates for companies offering gambling services, irrespective of their location.
The approval resulted in the GST Council imposing a 28% turnover tax on all services related to online gambling, land-based casinos, and horse racing.
The GST Council, composed of the Union Finance Minister and representatives from each state and union territory in India, holds the power to decide tax rates, exemptions, and administrative procedures.
According to Super Group, the newly effective tax rules make the Indian market economically unfeasible for the company.
However, despite its exit from the Indian gambling market, the company's management remains committed to achieving its full-year financial projections, as detailed in its Q2 trading update.
We are continuously evaluating evolving regulatory landscapes across the many markets we serve. Informed by years of operating our geographically diverse business, we remain confident about the long-term growth opportunities in front of us.
New GST Tax Attracts Criticisms
The 28% goods and service tax has been met with backlash in India’s local and international gaming industry. Ankur Gupta, Practice Leader, Indirect Tax at SW India, described it as a “big setback for Indian players” adding, “We might immediately see notices being issued to the gaming players for differential tax and with this new series of litigation.”
Roland Landers, CEO of The All India Gaming Federation, has described the new tax as “unconstitutional, irrational and egregious”.
Aaditya Shah, Chief Operating Officer of IndiaPlays also added “The bigger players might have more capital to burn to get through this phase, but unfortunately, startups will not have that chance.”
Online gaming companies and investors had intended to approach the government and the Prime Minister's Office (PMO) to seek a reconsideration. However, the government was unbending on the implementation of the new GST tax that has now come into effect. With the current reality, Super Group may be the first in a long list of gambling companies that would withdraw from the Indian market.
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