World Cup 2023: 21% tax levy leaves stakeholders in trouble

With the World Cup in India about 15 months away, the issue of taxation came to the fore and mitigating the loss of revenue from the showpiece event fell into the hands of the Board of Control for Cricket in India ( BCCI).

A letter from the Indian Ministry of Finance appears to have been sent recently to all concerned informing them that the tax levy on the 2023 World Cup will be 21%, more than double the tax collected at the last global event held in India. , Twenty20 World Cup in 2016, leading to a debate over who will bear the new withholding tax. The World Cup will take place in India in October-November 2023.

In 2016 it was 10% and it can be recalled that Star Sports had withheld $22.5 million from the $225 million tournament fee and, in accordance with the law of the land, the broadcaster had paid it to the government. Indian to TDS.

The BCCI was then run by a Committee of Trustees (CoA) and it was well known that the International Cricket Council (ICC) under Shahsank Manohar attempted to recover this amount from the BCCI’s share. After Jay Shah-led BCCI came to power in 2019, the decision was challenged.

Amid all of this comes the new tax rate and the amount this time could be a staggering over $100m as the 50th Anniversary World Cup broadcast fee is estimated to be over $500m of dollars. Cricbuzz has contacted everyone involved – the Star broadcaster, ICC and BCCI.

None of them were willing to come forward, but the impression that emerges is that the BCCI is trying to negotiate with the Indian government on this matter so that the revenues from the tournament, to be distributed among the members of the ‘ICC, is not seriously affected.

There is a school of thought that the tax issue is the responsibility of the host country, but BCCI’s position has been that they will do their best, but will not guarantee it. Discussions are ongoing on this even for the next cycle of 2024-31, when India will host three world championships.

With Jay Shah at the helm of the BCCI, the issue should be resolved, but the government’s decision to impose a 21% withholding tax could have implications for the next round of ICC media rights which are currently in progress. sale. As previously reported by Cricbuzz, broadcasters have sought to clarify this withholding tax issue.

Star Sports Straight Bags CA

Cricbuzz has learned that Star Sports has picked up the media rights to Cricket Australia (CA) for the next four years. The deal, with a provision to extend the deal for another four years, was reportedly signed by the parties. Sony is the current Australian cricket rights holder.

A CA spokesperson declined to comment, saying, “Nothing we can officially say about that at this time. I’ll let you know if that changes.” The agreement, for both television and digital rights, will come into effect from next season.

With these all-Indian matches in Australia, the series Ashes and the Big Bash League will air, from next season, on Star, which recently retained the television rights to the hugely lucrative IPL. He is also bidding for ICC rights.