All those involved in the forthcoming 2023 ICC World Championships, to be held in India next year, have been concerned as a 21% tax has reportedly been levied on the glamorous ICC event by the Indian Ministry of Finance and it now remains to be seen who will bear the brunt the additional financial burden.
With the World Cup in India only about 15 months away, the issue of taxation has come to the fore and mitigating revenue losses from the peak event has fallen into the hands of the Board of Control for Cricket in India (BCCI).
The last ICC event hosted by India was in 2016 when the Asian giant hosted the ICC T20 World Cup. At the time, the tax levied on the event was 10% and if you can recall, Star Sports had withheld $22.5 million from the $225 million tournament fee and the broadcaster wore it according to the law of the country the Indian government paid towards TDS.
The BCCI was then run by a Committee of Administrators (CoA) and it was a well-known fact that the International Cricket Council (ICC) under Shashank Manohar had attempted to recover that amount from the BCCI’s stake.
Tax levied by Indian Treasury on World Cup 2023 doubled from last event; BCCI, ICC Concerned
However, this time the new tax rate applied to the upcoming 2023 ICC ODI World Cup is 21 percent, more than double the levy applied to the last event, the 2016 T20 World Cup. This has led to a debate about who will bear the additional cost of this taxation.
The World Cup will be held in India from October to November 2023.
The level of the new tax rate and the amount could be astonishingly more than $100 million this time as the transmission fee for the 50-over World Cup is estimated at more than $500 million.
While Cricbuzz reported that none of the parties involved – ICC, BCCI and Star Sports – are willing to go on record; Reports suggest that the BCCI is attempting to negotiate the matter with the Indian government so that tournament proceeds, which are to be distributed among ICC members, are not severely affected.
Discussions have also been held for the next cycle of 2024-31, when India will host three global championships. There are people who think that the BCCI, as the hosting board, should bear the entire amount, but the BCCI feels that they will do their best but will not guarantee it.
The matter is expected to be resolved, but the government’s decision to impose a 21 percent withholding tax could have implications for the next cycle of the ICC media rights currently for sale.