Mobile Premier League (MPL), a domestically grown online gaming platform, has made a significant reduction in its workforce, affecting approximately 350 jobs. This decision comes in the wake of the 51st GST Council meeting’s unwavering stance on imposing a 28% Gaming Tax on gross value collected from online gaming.
As per a report by TechCrunch on Tuesday, the startup based in Bengaluru initially unveiled its job-cutting plans to its employees last week. Subsequently, it formally communicated these changes to the impacted employees.
Sai Srinivas, the founder, and CEO of MPL, penned an internal email explaining the rationale behind these measures. He highlighted that, being a digital enterprise, a substantial portion of their variable costs is linked to personnel, server, and office infrastructure. To ensure the company’s viability and survival, steps were imperative to curtail these expenses.
The layoffs within MPL coincide with the government’s resolute decision to levy a 28 percent tax on online gaming. Industry participants have expressed dissatisfaction, contending that imposing GST on deposits rather than the technology platform commission imposed by companies will render the unit economics unfeasible, severely impacting 80 percent of the sector.
The repercussions of this will largely affect micro, small, and medium-sized enterprises (MSMEs) as well as startups that champion innovative business models.
In a joint statement, the Federation of Indian Fantasy Sports and E-Gaming Federation articulated that the new tax structure, while aiming to provide clarity and resolve uncertainties, will result in an onerous 350 percent increase in GST, setting back the Indian online gaming industry by several years.
There is a silver lining as the GST Council has committed to revisiting tax rates and valuations six months after the implementation of these amendments, offering a glimmer of hope for the industry’s future.
Among MPL’s investors are Peak XV, Times Internet, MSA Novo, Crown Capital, Composite Capital, and Moore Strategic Ventures. Despite being one of the most esteemed gaming platforms, MPL faced losses amounting to approximately $149.3 million in FY22, experiencing a threefold increase from $48.3 million in FY21.
Established in 2018, MPL orchestrates a multitude of tournaments every month and boasts the trust of over 90 million registered users spanning India, Indonesia, Europe, and the US.
more recommended stories
Odysseus Lunar South Pole Odyssey: Historic Mission in Tilted State
Odysseus managed to land on the.
Odysseus Makes History: Soft Landing on Moon Ends 50-Year American Lunar Hiatus
The United States marked a historic.
Microsoft’s Copilot in Windows Now Manages System Settings and Accessibility with Ease
Microsoft has announced a new runtime.
Microsoft Copilot: A Year of Enhancing Productivity and Unleashing Creativity
Microsoft Copilot is celebrating its birthday..
Chandrayaan-3: NASA’s Laser Beams Confirm Vikram Lander as Lunar Focal Point
The Vikram lander of Chandrayaan-3 has.
Microsoft Unveils Copilot Pro: Elevating AI Capabilities for Microsoft 365 Users
Microsoft has rolled out Copilot Pro.
India Blocks Access to Binance, Kucoin, and OKX For Financial Violations
Google has removed access to foreign.
ISRO and SpaceX Join Forces: GSAT-20 to be Launched via Falcon-9
ISRO has established a strategic partnership.
Microsoft Copilot Android app now available: Check out how it works
Microsoft recently released Copilot Android app.
Microsoft Copilot Android app Quietly Lands on Google Play: What You Need to Know
Microsoft Copilot Android app is now.