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Goods & Services Tax impact: Watching Indian Premier League will hit pocket hard

With the Goods and Services Tax (GST) coming into effect from July 1, a number of stakeholders in the Indian sports industry are set to feel the heat from a heavier tax burden in the coming days. Tickets for sports events like the Indian Premier League (IPL) will attract a tax charge of 28 per cent, which will propel their prices.

other sports Updated: Jul 06, 2017 09:57 IST
HT Correspondent
Indian Premier League (IPL) tickets will attract a tax charge of 28 per cent after the implementation of Goods & Services Tax.
Indian Premier League (IPL) tickets will attract a tax charge of 28 per cent after the implementation of Goods & Services Tax.(PTI)

Starting from Saturday, India’s indirect taxation reform under the new Goods and Services Tax (GST) regime is set to impact a number of industries across the country. (GST LAUNCH UPDATES)

With this new apparatus coming into effect, the Indian sports industry will feel the heat from a heavier tax burden.

From a rise in the price of a number of sporting equipment, to that in the ticket prices for premier sports events, the fallouts of GST will be visible across a number of sectors in Indian sports in the days ahead.

Sports goods set to be costly

The biggest impact in the industry will be seen in the price of sports goods, a number of which are set to go up.

Sports manufacturers had been paying a two per cent excise duty on goods, after the charge was imposed in 2011. Under GST, these goods will be taxed under the 12-28 per cent slab, a steep rise from the existing charge.

(Read | Indian sports industry could reel under the burden of GST)

While many manufacturers had called for sporting equipment to be placed under the 5 per cent slab, arguing that it is still a cottage industry, the GST Council has decided to go ahead with a much higher rate.

The council doesn’t recognise a number of items like sports helmets, boxing headgear, sports kit bags, training bags, etc., as sports goods. These have been placed under categories from 12-28 per cent slabs.

Sports gloves will become costly as well, and will be charged at 12 per cent. The biggest blow, however, will be for athletics, gymnastics and table tennis equipment, all of which will be taxed at 28 per cent.

Essential fitness items, including shoes, skipping ropes, etc, too will bear the brunt of a high tax charge, as they have been placed in the 28 per cent slab.

“To make high quality equipment, we need support from the government. The current move might have a negative impact on the growth of the industry. There are more than 1000 registered units and another 1500 cottage units in villages,” Rakesh Mahajan, chairman of All India Sports Goods Manufacturers’ Federation had earlier told Hindustan Times.

Ashutosh Bhalla, director of Vinex Enterprises Pvt Ltd, too wasn’t impressed by the new rates. “All stakeholders should join hands to improve sports awareness in the country. Sports equipment will become more expensive (under GST),” he had told HT prior to the GST roll-out.

Pay more for IPL tickets, events by NSFs in 18 % slab

Tickets for sports events like the Indian Premier League (IPL) will attract a tax charge of 28 per cent, which will propel their prices.

Tickets for events organized by National Sports Federations (NSFs) will, however, be taxed at 18 per cent. Those for BCCI-organised cricket matches will also attract an 18 per cent tax.

However, tickets priced below Rs. 250 will be exempt from GST.

(With inputs from Navneet Singh)