In an e mail to workers on August 8, MPL cofounder and chief government Sai Srinivas mentioned the 28% GST levy “will increase our tax burden by as much as 350-400%.” This, he mentioned, had made it crucial for the corporate to take “some very tough decisions.”
The firm’s variable prices primarily contain folks, server and workplace infrastructure, which must be introduced all the way down to hold the business viable, he mentioned.
Despite initiating work on trimming server and workplace infrastructure prices, people-related prices would nonetheless must be minimize, and the corporate must “let go of around 350 of you,” the e-mail mentioned.
The GST council on July 11 determined to impose a 28% tax on on-line gaming at full face worth. This got here as a shock to the gaming trade, which had been batting for the tax to be levied on the GGR, or the platform payment, charged to customers.
Following the announcement, stakeholders of the net gaming trade, together with corporations and buyers, made a number of appeals to the federal government, urging a relook into the brand new tax guidelines.
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While the brand new tax regime is but to kick in, the trade expects a manifold rise in tax prices as soon as the 28% levy is imposed. Investors backing on-line actual cash gaming corporations have additionally mentioned that the choice may result in a possible write-off of the $2.5 billion capital invested within the sector.
Source: economictimes.indiatimes.com