The government earned Rs 91 crore from the first edition of Indian Premier League through tax deducted at source (TDS) on payments made to players, umpires, coaches and commentators among others.
Though the initial TDS amount received by the income tax department was quite low, the Central Board of Direct Taxes issued notices to the BCCI last year reminding that many of its franchisees had not collected TDS uniformly. In some cases, the tax was deducted at 2% from the payment made to some players.
Sources said the income tax (I-T) department had received around Rs 65 crore till the first six months of the current fiscal based on payouts amounting to Rs 670 crore.
In August, a CBDT notification had clarified that all sportspersons, Indian or foreign, besides coaches, trainers, umpires, referees, team physicians, physiotherapists, event managers, commentators, anchors and columnists must be levied TDS at 10%.
Everybody associated with the sport has been clubbed as professionals, same as those rendering technical services, under Section 194J of the I-T Act liable to pay TDS at the rate of 10%. Sources said while no discrepancies had been noticed in TDS on payments made to foreign players, in case of some Indian players, the tax deducted was at 2%, which is done in normal contract payments.
Meanwhile, IPL attracted attention of other tax departments too with the Commissionerate of Service Tax, Delhi, asking the organisers and partners to pay service tax on the sponsorship amount.
Though any sporting event is exempt from service tax, the IPL attracted the levy because of its commercial nature.