Online gaming companies hit with tax evasion bill of over Rs 28,000Cr
The IT department has reportedly sent notices to seven online gaming companies, as well as certain high-profile players with over Rs 50 crore in earnings.
The Income Tax (IT) department has issued show cause notices to seven online gaming portals as well as around three dozen high-profile players on these platforms. The government suspects these entities to have not paid taxes of up to Rs 28,000 crore.
As reported by the Economic Times, these notices have been sent out over the last 15 days. The individuals that have been targeted are those with earnings of over Rs 50 crore.
“We have the data…We are in the process of issuing notices to some of the players and companies,” said, Central Board of Direct Taxes (CBDT) chairman Nitin Gupta to ET, without providing further details.
This report has not been independently verified by YourStory.
This news comes after indications that the IT department and the CBDT (Central Board of Direct Taxes) have been tracking potential cases of tax evasion. Earlier this year, one online gaming portal with 8 million registered players was discovered to have had gross earnings of about Rs 58,000 crore over a three-year period.
The CBDT is currently also working on demystifying the potential ambiguity in online gaming taxation laws. At the moment, gross winnings face a flat 30% tax, with gaming portals required to deduct 0.1 percent of all winnings above Rs. 10,000 as tax deducted at source.
A source told ET that the portals were not strictly enforcing this tax deducted at source requirements.
Edited by Affirunisa Kankudti