Should IPL Be Taxed? Examining the Viral Demand for a 40% Tax on BCCI’s Earnings

The Indian Premier League (IPL), a cultural and commercial juggernaut, has captivated audiences and generated billions in revenue since its inception. However, a recent viral statement by Professor Mayank Shrivastava of the Indian Institute of Science (IISc) has ignited a heated national debate over whether the IPL should be taxed — and if so, to what extent.

Professor Shrivastava’s post questioned why an entertainment-driven enterprise like the IPL enjoys massive profits while remaining effectively shielded from income tax. His suggestion? A 40% tax on the IPL’s revenue, much like the taxation imposed on startups and other industries that struggle under heavy fiscal pressures. This bold demand has split public opinion and triggered critical examination of the IPL’s legal status under Indian tax law.

Understanding the Tax Exemption: Why IPL Isn’t Currently Taxed

To understand the controversy, we must first decode why the IPL is not taxed in the way one might expect.

The Board of Control for Cricket in India (BCCI) — the governing body behind the IPL — is registered under Section 12A of the Income Tax Act, which designates it as a charitable organization. This charitable status is grounded in the idea that the BCCI promotes the sport of cricket, a public good.

In 2021, the Income Tax Appellate Tribunal (ITAT) upheld the BCCI’s tax-exempt status, ruling that the IPL — despite being a commercial success — did not deviate from the core objective of promoting cricket. As long as the revenue is reinvested into developing the sport (through infrastructure, training academies, rural programs, etc.), the BCCI is permitted to retain its charitable designation and avoid standard corporate taxation.

But is this justification still valid in 2025? That’s where the argument begins to crack under scrutiny.

IPL’s Commercial Face: Entertainment or Sport Promotion?

While the BCCI frames the IPL as a vehicle for promoting cricket, critics argue the reality is far more commercial than charitable.

Here are some facts:

• The IPL generated ₹48,390 crore in media rights alone for the 2023–2027 cycle (Viacom18 and Disney Star).
• Franchise teams like Mumbai Indians and Chennai Super Kings are valued in billions of rupees, operating as full-fledged private businesses.
• Sponsorships, advertisements, merchandise, and ticket sales contribute heavily to revenues.
• Players are bought and sold in an auction system, not unlike any entertainment contract bidding.

This entire ecosystem mirrors the structure of a highly profitable entertainment industry more than a non-profit sporting development board. In fact, the comparison to Bollywood or OTT streaming platforms is not far-fetched. Yet, while such businesses pay significant taxes, the IPL ecosystem remains insulated from equivalent fiscal responsibilities.

Mayank Shrivastava’s Argument: Level the Playing Field

Professor Mayank Shrivastava’s viral post struck a chord with millions — particularly in India’s entrepreneurial and academic circles. His central argument was simple, yet powerful:

“Startups working on deep tech, innovation, and employment generation are taxed and scrutinized. But IPL — which is entertainment — earns billions and is not taxed. Why this hypocrisy? Hit them with 40% tax.”

Let’s break this down:

• Startups and MSMEs, many of which are trying to bring technological advancement or grassroots impact, are taxed at 25-30%, face GST compliance burdens, and are constantly monitored by various government agencies.
• The IPL franchises, meanwhile, enjoy public money (infrastructure, police deployment, etc.), earn revenue through public eyeballs, and often display opulence in a country where basic sports facilities remain underfunded.
• Even donation-based NGOs face intense scrutiny and Foreign Contribution Regulation Act (FCRA) compliance — while IPL is allowed to run as a de facto private enterprise under the legal veil of charity.

Mayank’s demand for a flat 40% corporate tax on IPL revenues is not just about fairness — it’s about structural equity in India’s tax system.

The Other Side: BCCI’s Justification and Legal Standing

To be balanced, it’s necessary to consider the counter-narrative.

The BCCI argues that all its revenue, including that from the IPL, is used to promote cricket in India. According to BCCI reports:

• Revenue is invested in grassroots development, including the Ranji Trophy, women’s cricket, and U-19 infrastructure.
• It funds stadium maintenance, regional cricket associations, and training camps.
• The IPL creates jobs for coaches, physios, curators, and broadcasters.
• The sport reaches tier-2 and tier-3 cities, broadening cricket’s influence beyond metros.

There’s also the legal precedent — as recently as 2021 — where courts agreed that the charitable purpose of promoting sport still holds, even if money is generated commercially. This is the same logic applied to educational institutions that charge fees but are still considered charitable under certain conditions.

However, the problem lies in scale and transparency. When an enterprise becomes too big, its “charitable intent” often gets diluted, especially when there’s limited public access to audited use-of-fund reports.

A Middle Path: Reforms Instead of Exemptions

While Professor Shrivastava’s 40% tax suggestion is radical, it serves as a wake-up call. Rather than outright revocation of tax exemption, several reform-based solutions are possible:

1. Partial Taxation of IPL Earnings: Separate IPL revenues from the rest of BCCI’s operations. Tax the commercial segment, retain exemptions for grassroots development.
2. Transparency Mandates: Make it compulsory for BCCI to publish audited, detailed annual reports on how IPL revenue is used.
3. Capping Charity Status: Impose a revenue or profit threshold, above which an organization automatically loses Section 12A status.
4. Tax IPL Franchises Independently: The private teams, like Kolkata Knight Riders or Royal Challengers Bengaluru, should be taxed like normal businesses.

These steps can ensure that public good and private gain are clearly demarcated — a core principle in democratic taxation.

Conclusion: Time to Rethink What We Reward

The IPL has undoubtedly revolutionized cricket and popularized it in a format that’s accessible and exciting. However, it is also a money-making machine that runs on capital, celebrities, and consumerism.

In contrast, startups, researchers, and social entrepreneurs continue to face financial pressure and regulatory hurdles. In such a landscape, shielding a billion-dollar league under charitable clauses feels deeply unjust.

Professor Mayank Shrivastava’s post is not just a momentary viral spark — it’s a reflection of growing discontent among taxpayers and professionals. It’s a call for fairness, reform, and structural honesty in India’s tax and regulatory system.

Yes, support cricket. Yes, fund sports. But let’s not confuse entertainment empires with public service institutions. It’s time the government revisits this legal loophole and brings tax parity to all players in the economic game — be it a cricketer, a coder, or a creator.