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May 2011

Sport and nation — Given the market for cricket, why tax breaks and cash awards?

By Raman Jokhakar, Tarunkumar Singhal Chartered Accountants
Reading Time 2 mins
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The Indian cricket team deserves all the accolades, the love and affection, the wild enthusiasm and all the money it made for winning the World Cup for the country. This was a historic and well-deserved victory for, clearly, one of the world’s best cricket teams today.

The players, their coaches and selectors have all been adequately rewarded not just in kind, but also in cash. In any case, India’s cricket players are the richest among the country’s sportspersons, given the money in the sport, the sponsorships and the advertisement budgets. The glistening diamonds worn by the wives of Indian cricketers, and their fancy cars, tell a tale of adequate recompense. So why did the taxpayer have to shell out more cash, in the form of cash awards from state governments and a tax break from the central government? There are games sportspersons play to win and there are games they play to make money. The Indian Premier League is a money-making enterprise. But a World Cup match is about winning for the country. It is the kind of achievement that finds recompense in the form of a Padma Shri or a Padma Bhushan award.

But tax breaks and cash awards from the government are an unnecessary indulgence. Gujarat’s Chief Minister Narendra Modi has resisted the cash award idea; instead, he has so far restricted himself to giving the Eklavya award. Some of India’s world-class sportspersons deserve financial support given the lack of adequate investment and the absence of a mass market in their respective sports. Cricket is certainly not one of them. The market is doing a good job, and the government, too, has done a good, indeed an excellent, job in ensuring security and safety of the players and the huge audience. Having done the job it must, and that too well, the government need not have tried to ingratiate itself with the players with more cash!

(Source: Business Standard, dated 5-4-2011)

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