The Central Government has formed a special inter-ministerial committee mandated to come up with recommendations on how to regulate online gaming in the country and to identify which ministry is best suited to oversee the activities of the sector.
The panel will study global best practices and consult experts in the field, and on the basis of its findings will devise a uniform regulatory framework to be enacted for the whole of India. The issues to be examined include the gaming operators’ compliance burden, ease of doing business, the creation of a level playing field, and player protection against various risks and harms related to gaming such as addictions and compulsive gambling.
The seven-member taskforce is composed of the chief executive officer (CEO) of government think tank NITI Aayog, as well as secretaries of several ministries – home affairs, finance, industries and internal trade, information and broadcasting, electronics and information technology, and sports and youth affairs.
Another panel – a Group of Ministers (GoM) appointed by the GST Council, has been examining GST applicability and valuation matters related to Goods and Services Tax (GST) levy over online gaming, casinos, race courses and lotteries.
Reportedly, the GoM will recommend a uniform GST levy at the highest rate slab of 28 percent for all gaming activities, thus equalizing the indirect tax of online skill gaming and fantasy sports to the levy on real money Teen Patti and other online gambling titles, land-based casino games, horse race betting and lottery draws.
There Is a Lot to Be Learned from the World’s Experience in Gaming Regulation
Devising and implementing a sensible, balanced and comprehensive regulatory framework over such a vast area as online gaming and gambling is not an easy task. Still, India has the chance to learn from the experience of a number of countries from around the world which have already regulated the field, and by taking out the successful parts and avoiding the not so fortunate practices can draw up the optimal legislative solutions for Bharat realities and culture.
Currently, only the best roulette sites, casino gaming, online lottery and sports betting platforms operating in India are regulated by a reputable international licensing authority, while Indian online space is flooded by other gambling platforms of dubious integrity and quality including even openly scammy and fraudulent websites.
At the same time, homegrown Indian online skill gaming and fantasy sports operators are faced with a compliance nightmare in a regulatory jungle of inconsistent and often conflicting or ambiguous state-level laws and even blanket bans on gaming. As a result, litigations are a frequent occurrence that drain resources and energy from public authorities and operators alike.
An unregulated legal space, especially if a blanket ban is enacted, does not eliminate online gaming as it only denies people access to a regulated and safe gaming experience. At the same time, the niche is filled by irresponsible or even criminal actors who make use of the situation.
The task of any sensible regulation over gaming is to curb the activities of such fraudulent websites and to make sure the public is exposed only to legitimate operators who deserve their license by following strict verification procedures and robust requirements to offer a safe gaming product with secure deposit and withdrawal options.
Another major task to be fulfilled by India’s future gaming regulation is to ensure gamer protection through a system of norms relating to responsible gaming mechanisms, age verification protocols, data protection measures, restrictions and conditions applying to marketing and advertising, as well as gameplay, spending limits and other matters.
Achieving these tasks, a regulatory framework will exercise effective control over the societal costs related to online gambling, but will also cut the incomes of criminal circles and raise taxation revenues which can be used for welfare purposes.
Even countries with years of experience in gambling regulation like the UK or Sweden encounter difficulties finding the right balance of legislative provisions and restrictions to benefit all stakeholders – including the citizens, the industry, and the state, to an equal and satisfactory extent.
The new inter-ministerial panel has an important and complex task ahead of them which will only be facilitated from the treasury of existing global experience in online gaming regulation.