How the Indian Government Earns from IPL via GST & TDS

The Indian Premier League (IPL), orchestrated by the Board of Control for Cricket in India (BCCI), is not just a cricketing spectacle but a financial juggernaut that significantly contributes to the Indian economy. While the BCCI, the world’s richest cricket board with a revenue of INR 20,686 crores in FY 2024, enjoys tax exemptions on its income, the government still reaps substantial revenue from the IPL through Goods and Services Tax (GST) and Tax Deducted at Source (TDS). Here’s a breakdown of how the government cashes in on this T20 extravaganza.

BCCI’s Financial Might and Tax Exemption

The BCCI’s financial clout stems largely from IPL media rights, sold to Disney Star and Viacom18 for a colossal INR 48,390 crores for the 2023-27 cycle. This deal alone underscores why the BCCI outstrips its 108 global counterparts in revenue. Yet, despite its private status and massive earnings, the BCCI pays no Income Tax. Why? Registered under the Tamil Nadu Societies Registration Act of 1975 as a charitable entity, the BCCI’s mission to “promote and develop cricket in India” qualifies it for tax exemptions under Section 12AA of the Income Tax Act. This status, upheld by the Income Tax Appellate Tribunal (ITAT) in 2021, has sparked debate but remains a cornerstone of BCCI’s financial strategy.

GST: A Key Revenue Stream

While Income Tax is off the table, the BCCI isn’t entirely tax-free. It is liable to pay Goods and Services Tax (GST) on its IPL-related earnings, including ticket sales, sponsorships, and a share of media rights revenue. According to a parliamentary report cited by The Financial Express, the BCCI shelled out INR 2,038.55 crores in GST over the financial years 2022-23 and 2023-24. This figure reflects the 18% GST rate applied to services like event organization and broadcasting rights distribution, which the BCCI shares with franchises (40-50% of media rights revenue). For context, with IPL 2025’s projected revenue exceeding INR 10,000 crores, the GST contribution could approach INR 1,800 crores annually, making it a significant windfall for the government.

TDS: Taxing Player Salaries

The government also taps into IPL earnings through Tax Deducted at Source (TDS) on player salaries. Indian players face a 10% TDS deduction, while foreign players are subject to a 20% cut, as per Income Tax regulations. This applies to the salaries paid by franchises, which are funded by BCCI’s central revenue pool and franchise-specific income (sponsorships, ticket sales, etc.).

For IPL 2025, the mega auction saw 182 players sold—120 Indian and 62 overseas—generating a TDS haul of INR 89.49 crores:

• Indian Players (120): Total salary outlay of INR 337.6 crores (approx.) at 10% TDS = INR 33.76 crores
• Foreign Players (62): Total salary outlay of INR 278.65 crores (approx.) at 20% TDS = INR 55.73 crores
• Total TDS Collected: INR 89.49 crores

This figure, derived from auction salaries alone, excludes additional earnings like match fees or endorsements, suggesting the actual TDS collection could be higher during the season.

Also read: Why RCB is most popular IPL team on social media?

How It Adds Up for the Government

• GST from BCCI: With INR 2,038.55 crores collected over two years (averaging INR 1,019 crores annually), GST forms the bulk of government revenue from the IPL. This covers BCCI’s operations and its revenue-sharing model with franchises.
• TDS from Players: The INR 89.49 crores from the IPL 2025 auction is just the tip of the iceberg. Including mid-season signings, uncapped player contracts, and support staff payments, TDS could exceed INR 100 crores per season.
• Indirect Revenue: Beyond GST and TDS, the government benefits from taxes on IPL-related economic activity—corporate taxes on sponsors, GST on merchandise, and service tax on hospitality—pushing the total take into thousands of crores annually.

Why It Matters

The BCCI’s tax-exempt status might raise eyebrows, but the IPL’s economic ripple effect ensures the government isn’t left empty-handed. GST keeps the revenue flowing from the league’s commercial operations, while TDS directly taps into the players’ earnings, balancing the tax burden. For IPL 2025, with a projected valuation of INR 92,500 crores (as per D&P Advisory), the government’s earnings via GST and TDS could surpass INR 2,000 crores for the season alone, reinforcing the IPL’s role as a fiscal powerhouse.

Conclusion

The government’s revenue from the IPL via GST and TDS showcases a clever workaround to BCCI’s Income Tax exemption. While the cricket board channels its profits into infrastructure and grassroots development, the state coffers benefit from taxing the league’s transactions and salaries. From INR 1,000+ crores in GST to nearly INR 100 crores in TDS per season, the IPL isn’t just a sporting event—it’s a golden goose for India’s treasury.