Pawar doesn't want Maharashtra to milk IPL cash cow

Published>Sat, Mar 20 10 07:27 AM

Union Agriculture Minister Sharad Pawar's love for cricket may cost the government of Maharashtra over Rs 300 crore. Maharashtra Cricket Association (MCA) president Pawar is reportedly at loggerheads with chief minister Ashok Chavan over levying entertainment tax on the Indian Premier League (IPL) teams.

Sources said Pawar's Nationalist Congress Party (NCP) was arm-twisting the state government to forego Rs 300 crore worth of revenues in the form of entertainment taxes on the IPL. The state cabinet had on January 20 decided to levy a 20-25 per cent tax on the IPL matches held in Maharashtra. But the resolution is yet to be ratified. Sources said the NCP in the meeting had agreed to impose the tax but later did a U-turn.

When asked about whether the state too concurred with the NCP's view, Chavan said the decision had not been annulled. But the NCP sang a different tune on the issue. Finance minister Sunil Tatkare, who hails from the NCP, said the state had decided not to charge any tax on the IPL matches "in the interest of the sport".

But a Congress minister said, "It was decided in the meeting that while Test matches should not be taxed in the interest of its survival, One-Day Internationals and Twenty20 matches could be taxed as they were popular and didn't need any promotion. Accordingly, it was decided that a tax of 25 per cent would be levied on the IPL tickets for matches in Mumbai and 20 per cent in the rest of the state." "But in the subsequent meeting held on February 3, there was no mention of tax on the IPL matches," the minister added.

Tatkare defended his party's insistence to waive off the tax, saying, "Rs 20 crore annually is not so huge a sum that could dent the state exchequer." But the Opposition begged to differ. State BJP spokesperson Madhav Bhandari said, "Our estimates suggest that if the government does not levy the tax, the loss of revenue would be much more than Rs 20 crore." He added, "The minister is only counting gate money and even that is a faulty calculation. In 2008, the state lost Rs 70 crore on ticket sales alone. This year, if we calculate the ticket sales, advertising (both in-stadia and television) and telecast rights, the turnover is not going to be less than Rs 1,600 crore. If we calculate at 20 per cent, the revenue loss will total to over Rs 300 crore."

But a highly placed official in Reliance Industries Ltd, which owns the IPL team Mumbai Indians, said: "The BJP's calculations are all wrong. Our collections from the stadium are not more than Rs 40 crore. So, the loss of revenue is not more than Rs 10 crore."

Bhandari has written to the CM and Tatkare, bringing to their attention the possible loss of revenue. "If they don't relent, we will move the High Court on the issue," he said. But going by the CM's stand, they need not. A source close to Chavan on Saturday said, " Why should the IPL, which is an out-and-out commercial venture, get tax benefit? It's a money-spinning machine for all participants and the state need not lose an opportunity to earn revenue that could be used for infrastructure projects." "Why should the state lose out when franchisees are milking the event?" the source asked.

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