A recent industry study tracking Indian traffic to such sites counted 1.6 billion visits in last December quarter
The expectation of a sin GST rate of 40 per cent on online real-money gaming has pushed the sector to a corner even while the industry foresee people shifting to offshore illegal gaming apps.
The shift to offshore illegal betting sites was more pronounced when rates were increased to 28 per cent. Now domestic users are being wooed with claims such as “no KYC”, “tax-free winnings”, “no TDS/GST”, and so forth.
A recent industry study tracking Indian traffic to such sites counted 1.6 billion visits in the December quarter, with over 1,000 paid promotions on major social platforms funnelling users to these operators. That report attributes 42.8 million clicks directly to social ad placements.
Shashank Shekhar Garuryar, Chairman of online security platform Cyber Vidyapeeth, said the Ministry of Electronics and Information Technology has blocked 1,410 sites between 2022 and early 2025; a parliamentary disclosure in July indicated about 1,524 illegal betting and gambling sites/apps were blocked to date.
Since October 2023, legitimate platforms have paid 28 per cent GST on top of 30 per cent TDS on net prize money.
Tax outgo
Several online gaming companies have reported tax outgo exceeding their topline platform fee, forcing price increases or reduced promotions, both of which nudge price-sensitive players to illicit alternatives promising “no tax” and big bonuses, he added.
The Advertising Standards Council of India’s latest annual report shows offshore betting among the top ad violators in 2024–25, often running influencer-led and surrogate campaigns that blur lines between “news,” “sports communities”, and outright betting funnels.
While a legal ₹100 deposit yields far less playable value after GST and TDS, the illegal site loudly promises “tax-free, higher bonuses” to attract users. The users who shift offshore lose legal recourse amid heightened fraud risk.
Incidentally, the Gameskraft batch of cases — which go to the heart of classification and valuation — has wrapped up hearing in the Supreme Court. The court stayed wide-ranging GST notices earlier this year and recently concluded final hearings, and has reserved the judgment.
Published on August 19, 2025
