Indian government probes 642 offshore gambling companies for tax evasion

The Indian government has launched an investigation into 642 offshore entities involved in online gaming, betting, and gambling for alleged tax evasion, Minister of State for Finance Pankaj Chaudhary informed Parliament on Monday.

The Directorate General of GST Intelligence (DGGI) has identified these entities for their suspected evasion of Goods and Services Tax (GST). Offshore platforms operating in India are mandated to pay 28% GST on the full value of real-money gaming bets, a compliance many are believed to have flouted.

Entities found uncooperative during the probe have been flagged to the Ministry of Electronics and Information Technology (MeitY). Under Section 14A(3) of the IGST Act, 2017, MeitY has been requested to block their websites or URLs.

"DGGI does not have any reciprocal arrangements with foreign governments. However, 642 offshore entities providing online money gaming/betting/gambling have been identified for investigation," said Chaudhary in the Lok Sabha.

The investigation comes amid claims that illegal offshore betting operations cost India approximately $2.5 billion annually in GST revenue.

The booming Real Money Gaming (RMG) sector in India is expected to generate $7.5 billion in revenue over the next five years, making regulatory oversight critical. The government’s action against these offshore platforms underscores its intent to curb tax evasion and promote fair business practices in the industry.