Leading gaming and hospitality corp in India postpones IPO in face of new taxes

Delta Corp, the largest gaming and hospitality in India, has put on hold its plans to make its gaming arm public in the face of uncertainty; Delta Corp operates the largest offshore gaming vessel, the five-decked Deltin Royale, along with other the Deltin JAQK, and the Deltin Caravela; Indian government to slap fines on non-compliant gaming operators.

Original story from Focus Gaming News with insights from the ACN Newsdesk

Delta Corp has made the decision to postpone plans to take its online gaming unit public due to the uncertainties surrounding the GST’s decision to impose a tax rate of 28 per cent on the full face value amount for online gaming, casinos and horse racing betting.

The company’s CFO, Hardik Dhebar, expressed the importance of clarity for investors.

In the second quarter of the year, Delta Corp’s online gaming unit contributed 15 per cent to its net revenue, excluding GST.

The definition of online gaming is expected to be clarified during the GST council’s upcoming meeting on Wednesday, August 2.

There have been doubts about whether the tax will be levied on the entry-level or on each wager. While officials have said there will be no revision to the proposed rate, the meeting will seek to resolve this aspect.

Various online gaming companies have expressed concerns over the potential ramifications of the tax, arguing that it could significantly impact volumes and the overall viability of gaming businesses.

Last July, India’s government said it would impose a 28% tax on funds that online gaming companies collect from their customers, in a blow to the $1.5 billion industry that has surged in popularity and attracted foreign investment. Gaming associations in India denounced the mandate as ‘unconstitutional and irrational.’

Finance Minister Nirmala Sitharaman said the decision to impose tax on the total amounts gaming companies collect was taken after consultation with states, and the intent was not to hurt the industry.

The Indian government has warned that it will take action against gaming sites that do not pay a proposed new tax rate.

The Finance Ministry and Ministry of Electronics and Information Technology (MeiTy) have said they will block non-compliant platforms. The Directorate General of Goods and Services Tax Intelligence (DGGI) will compile a list of violators.

Read the original story on India’s largest gaming industry here: https://focusgn.com/asia-pacific/delta-corp-delays-online-gaming-ipo-due-to-gst-uncertainty