A sporting proposition for BCCI

Indian cricket could benefit from much-needed transparency

The recent elections to the powerful Board of Control for Cricket in India (BCCI) have drawn attention once again to the link between political parties and sporting associations. Roger Binny, the new president, has no known political affiliations, but the treasurer is a Bharatiya Janata Party leader, the secretary is the Union home minister’s son, and the vice-president is a Congress politician. This connection follows a well-established tradition in India across key sports such as football, hockey, badminton and table tennis. Cricket, being India’s most popular sport by a long chalk, has attracted attention because of the long association of particularly powerful politicians with the administration of the game — from Sharad Pawar and Arun Jaitley to Madhavrao Scindia and his son Jyotiraditya. In the world of professional sports, this is a unique configuration but it is easy to understand why Indian politicians seek to associate themselves with sports administration. Apart from commanding the powerful gift of fund flows from the sports ministry, those affiliations offer such priceless benefits in terms of access to prime ringside seats at major tournaments in India and overseas. An allied perk is fast-tracked access to global sporting stars. The fact that Indian cricket outside of the Indian Premier League’s (IPL’s) T20 format remains mired in unprofessionalism and, occasionally, allegations of corruption, is not incidental to this state of affairs.

Another questionable aspect of the BCCI more than any other association is its tax-exempt status. Thanks to the IPL, the BCCI is by miles the richest cricket association in the world. In June, the auction of the broadcasting rights for the 2023-27 cycle went for Rs 48,390.5 crore, double the amount for the previous cycle. Add in the multiple sponsorship rights and the IPL ranks with America’s National Football League (NFL) and the English Premier League (EPL), on which it is modelled, as one of the richest sporting leagues in the world. Yet, unlike the NFL and EPL, neither the BCCI nor the IPL pays tax because of the former’s registration as a “charitable organisation”. This status, in fact, enabled it to gain the benefit of a remarkable ruling from the Income Tax Appellate Tribunal (ITAT) in November last year, when the ITAT extended the BCCI’s tax-exempt status on grounds that the income it generated from the IPL was “incidental” to the BCCI’s primary objective of promoting cricket in India. This argument is misleading because though the IPL accounts for the lion’s share of BCCI revenues, it functions on a specific and unabashed business model. By rights it should be spun off as a separate entity under the BCCI and subject to tax. The English Football Association, for instance, is also a not-for-profit entity, but the EPL, which comes under it, is registered as a company and pays tax to the British exchequer for the enormous profits it makes each year. It is no coincidence that warts and all, it remains Europe’s most successful football league in an acutely competitive environment. Given the BCCI’s huge reliance on the IPL, both the body and Indian cricket in general could benefit from such much-needed transparency.