GST Impact on IPL and Pro Kabaddi

With launch of Goods and Services Tax (GST), the Indian sports industry feels the heat from a heavier tax burden in the near future. Tickets for sports events such as the Indian Premier League (IPL) will include a tax charge of 28% approx., which will boost their prices. The impact of GST will be clearly visible with the rise in the prices of sports goods and equipments as well price hikes of tickets for premier sports events.

Sports goods set to be costly

The manufacturers in the industry had been paying a 2% excise duty on goods, after the charge was imposed in 2011. Now, under GST, these goods will be taxed under the 12-28% slab, a steep rise from the previous charge. While most of the manufacturers had called for sporting equipment to be placed under the 5% slab, debating the industry still falls under cottage industry category; the GST Council decided to set with a much higher rate.

The council doesn’t consider a number of products such as sports helmets, sports kit bags, training bags, boxing headgear, etc., as sports goods. These have been placed under categories from 12-28% slabs. While the sports gloves will be charged at 12%, the athletics, gymnastics and table tennis equipment will be taxed at 28%. Essential fitness items such as sports shoes, skipping ropes, etc, will also feel the heat of GST reform, as the category has been placed in the 28% 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.

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

Tickets for the events organized by National Sports Federations (NSFs) and of course BCCI-organized cricket matches will be taxed at 18%. Tickets for Indian Premier League (IPL) as well as Pro Kabaddi League (PKL), will even go higher as they will be taxed at 28% under the new GST regime.Tickets priced below Rs.250 will be exempt from GST.

(A compiled report)