Karnataka to come out with rules to govern online gaming and combat illegal betting
This move comes months after the Tamil Nadu Online Gaming Authority published a set of rules to regulate real-money games in the state.
The Karnataka government plans to bring out a set of rules to regulate the online gaming sector and combat the rise of illegal betting and offshore gambling.
Karnataka IT Minister, Priyank Kharge, in a post on X, said the government held a meeting with senior government officials, members of online gaming federations, and industry experts, along with Home Minister G Parameshwara, to discuss a legal framework to regulate the online gaming sector.
“The legitimate online skill-based gaming industry in India is a sunrise sector worth $4 billion, contributing Rs 12,000 cr in taxes and creating 1.5 lakh+ jobs. Karnataka alone accounts for 25% of the market and Rs 1,350 cr in annual tax contributions, making it a key hub,” Kharge said in the post.
According to a PTI report, Parameshwara said a committee of senior officials and industry representatives has been constituted and given a month’s time to submit a draft of the proposed bill. He also said that once the draft is submitted, the government will look to bring in a new law.
Karnataka's decision to bring out a regulatory framework comes on the heels of the Tamil Nadu government coming out with a set of rules to address the growth of offshore betting platforms.
The rules include mandatory KYC (know your customer) verification to create an account to play online games. KYC verification has been made mandatory for initial login with Aadhar, which will be authenticated by a second layer of verification using a one-time password sent to the phone number linked with the Aadhar number.
The Tamil Nadu government has also introduced a curfew from midnight to 5 AM for players logging in from the state. This rule has left real-money gaming companies scrambling for clarity, as many competitions are held during this time. Many platforms also see increased activity during this time, say industry players.
Meanwhile, on the taxation front, the online gaming segment in India faces a 28% GST, which is borne by the gaming companies.
(With inputs from Press Trust of India)
Edited by Swetha Kannan