New Delhi: The central government is gearing up to prohibit all transactions involving money in online gaming through the upcoming Regulation & Promotion of Online Gaming Act. On Tuesday, the Union Cabinet, led by Prime Minister Narendra Modi, gave the green light to the Online Gaming Bill, which classifies online betting as a criminal offense.
According to sources speaking to Business Today TV, the legislation will bar banks and financial entities from facilitating any fund transfers tied to real-money online games. It also plans to clamp down on promotions for real-money gaming, while encouraging the growth of E-sports and non-monetary skill-based digital games. The bill is slated for introduction in the Lok Sabha on Wednesday.
This new framework seeks to establish uniform national regulations for the industry and criminalize digital betting. It tackles issues like addiction, fraudulent practices, and inconsistencies in state gambling regulations, with provisions for stricter monitoring of real-money platforms. The Ministry of Electronics and Information Technology (MeitY) is poised to become the primary overseer, granting powers to shut down non-compliant or illicit websites.
The sector has faced increasing fiscal scrutiny, with a 28% GST levied on online gaming platforms starting October 2023. As of FY25, earnings from these games attract a 30% tax, and foreign-based operators are now included in the tax framework. Officials can also restrict access to unregistered or unlawful sites.
New criminal measures under the Bharatiya Nyaya Sanhita, effective from December 2023, impose penalties of up to seven years imprisonment and steep fines for unauthorized betting. That said, since betting and gambling are listed under the State List in the Constitution, individual states hold the right to enforce actions against illegal operations.
Between 2022 and February 2025, the government has already restricted access to more than 1,400 betting and gambling sites and applications. In response to growing addiction worries, the Education Ministry has sent out alerts to parents and educators, and the Information and Broadcasting Ministry has mandated that ads related to gaming include warnings about financial dangers and addiction risks.