India Faces Potential Nationwide Online Gambling Ban Amid Rising Regulations

India Moves Toward a Total Online Gambling Ban

India is on the verge of enforcing a comprehensive ban on all online gambling activities. This initiative is part of a newly proposed law called the Promotion and Regulation of Online Gambling Bill, which aims to halt online gambling across the country.

Details of the Draft Bill and Its Implications

The draft legislation has received Cabinet approval but has yet to be officially implemented. If enacted, the law would cause the immediate closure of various online gambling sectors, including sweepstakes, social casinos, and skill-based gaming platforms.

The bill also outlines strict penalties for violations. Operators found breaking this law could face penalties including imprisonment for up to three years and hefty fines approaching $100,000. Furthermore, gambling advertisements would be banned from all forms of media, encompassing physical advertisements, broadcast radio and television, as well as digital platforms such as social media.

Financial institutions will also be required to impose stringent restrictions on transactions linked to gambling, except for necessary financial payments. The motivations behind this tough stance remain unclear, especially since unregulated online operators continue to attract local players without significant interference.

Potential for Increased Taxes if the Ban Is Not Enforced

Instead of a complete ban, a regulatory framework could be a more effective strategy, helping to control offshore gambling activities and provide safer gambling options to players. A full prohibition, however, risks pushing gamblers toward illegal black markets due to lack of legal alternatives.

Even if the full ban is not put into effect, the government is considering raising the goods and services tax on gambling from the current 28% to 40%, which would significantly increase the financial burden on the industry.

Concerns About Current Strategies and Player Protection

Historically, India has taken a rigid approach to gambling legislation, but evidence suggests recent measures may disproportionately target the regulated market rather than effectively addressing the illegal gambling sector.

Other countries, like the Netherlands, have recognized that increasing taxes and restricting regulated markets can unintentionally undermine player protections, emphasizing the need for balanced regulation over outright bans.