BCCI earns billions from IPL, but doesn’t pay tax at all due to…., reason will shock you

BCCI IPL Income Tax: In India, people love watching and playing cricket. It is not just a sport but an emotion in the country, and the IPL is not just a cricket tournament but has become a festival where business worth crores is done every year. From auctions to sponsorships, the BCCI earns from both ends. But do you know that despite earning billions from the IPL, the BCCI does not have to pay tax on it? Actually, the IPL doesn’t fall under taxable income, as the BCCI has received an exemption for a special purpose.

Yes, the BCCI does not have to pay any tax on the earnings from the IPL. The reason is that even though the Board earns a hefty amount from the league, its main objective remains “promoting cricket.”

According to a report by Financial Express, BCCI earns a total of 20, 686 crores, a large part of which came from IPL matches. But in the name of promoting cricket, BCCI does not pay any income tax on it.

BCCI Registered As A Charitable Organissation

Yes, it is true, BCCI is officially classified as a charitable institution under the Tamil Nadu Societies Registration Act, 1975. Its primary objective is to promote and develop cricket in the country. Hence, the board is exempted under Section 12AA of the Income Tax Act, which is reserved for charitable organisations.

What Was The Matter, When Did The Decision Come?

The Income Tax Appellate Tribunal (ITAT) ruled in favour of the Board of Control for Cricket in India (BCCI), maintaining its tax-exempt status. In November 2021 decision overturned the Income Tax Department’s 2016-17 attempts to revoke BCCI’s Section 12AA exemption for IPL income.

The ITAT clarified that commercial success, achieved through increased popularity and sponsorship, does not change the organisation’s primary nature and purpose of promoting the sport.

BCCI Pays GST

BCCI won a tax case, successfully arguing that its IPL revenue is not subject to income tax.  The tax tribunal disagreed with the Income Tax Department’s assessment, which focused solely on IPL surplus rather than the BCCI’s overall operations.  While the BCCI’s 2023 IPL earnings totalled Rs 11,769 crore,  it remains exempt from income tax on these earnings.  However, the BCCI does pay GST, having remitted over Rs 2,038.55 crore between 2022-23 and 2023-24.

BCCI Promotes Cricket

The ever-increasing revenue and popularity of the sport have made BCCI the juggernaut of the cricketing world. It is noteworthy that there are 108 cricket boards across the world, but 70-80 percent of the revenue of the ICC comes from the BCCI.

Well, BCCI really supports the state cricket associations to popularise cricket, and the success of IPL has created many stars who are making waves across the world.

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