The Background:
The Goods and Services Tax (GST), the single biggest tax reform in independent India, was rolled out at the stroke of the midnight hour on June 30. The historic reform is set to impact a number of industries across the country.
The tax rates are classified under four slabs — five percent, 12 percent, 18 percent and 28 percent.
The Story:
Cricket has not managed to evade the GST either and starting from fans to players to organisers, everyone will be affected by the tax reform.
The new system of tax is set to increase the prices of sports equipment. The sports manufacturers had been paying a two percent excise duty on goods after the charge was imposed in 2011. However, under GST, the goods will be taxed under the 12-28 per cent slab, a steep rise from the existing charge.
The manufacturers had called for sporting equipment to be placed under the five percent slab, arguing that it is still a cottage industry. But with the policy makers not recognising a number of items like helmets, gloves as sports goods, the prices of these equipments have been placed under categories from 12-28 per cent slabs. The bats and balls have also been included in the 12 percent bracket.
“It is going to increase prices because rates, earlier on bats, was 2 percent excise,” Jatin Sareen of SS Sports, one of the leading cricket equipment manufacturers in the country was quoted as saying by the Indian Express. “Now it is 12%. If a bat earlier cost Rs102, now it is going to cost 114. Helmets and gloves will also get more expensive with the tax rates hiked to 28 per cent. So it is going to get even more expensive for the general consumer.” he continued.
Indian Premier League Affected Too:
The fans will now have to shell out a fair bit of amount to enjoy an Indian Premier League match because the matches are charged an entertainment tax. The price of the IPL tickets will now attract a tax charge of 28 per cent, which is a steep rise.
“From what we gather and estimate, there will be a 28 percent tax on IPL tickets. So ones that cost Rs 1,000 will cost around Rs 1,300. More importantly, the cost of conducting the IPL will increase because the rise in taxes will be felt at several stages, for the different types of services hired for different things,” a top BCCI source told Indian Express.
However, the events organised by recognised sports federations will attract 18 percent tax on ticket prices. It includes the matches of the India cricket team.